in Finance (UCF) Sophomore Open House Director of Undergraduate - PowerPoint PPT Presentation

The Bendheim Center for FINANCE Undergraduate Certificate in Finance (UCF) Sophomore Open House Director of Undergraduate Studies : Yacine Ait-Sahalia Program Administrator: Melanie Heaney-Scott April 3, 2020

What is finance? • How are financial securities such as stocks, bonds, currencies and derivatives priced and what information these prices carry • How to construct and manage portfolios of financial and real assets • How to manage risk • How corporation or other businesses finance themselves • How to decide whether to invest in a project • Public policy including monetary policy, financial-market and banking regulation

The tools of finance • Modern finance is eclectic • Draws from many disciplines including economics, mathematics, operations research, engineering, computer science, psychology, politics, and history.

Multidisciplinary: Combines methods and courses from multiple departments Flexible: allows you to Why should I do it? major in any dept Directly applicable skills

Open to Every Major Economics, Engineering, ORFE Physics, Math, Molecular Biology Certificate in Finance Architecture, Art, Music, Religion, History, Woodrow Wilson, English Politics, History, Sociology

Certificate Numbers: Past 10 Years UCF CLASSES 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 WOMEN 17 25 17 21 24 28 28 37 23 29 MEN 46 54 53 51 58 63 66 62 62 48 WOMEN(%) 27% 32% 24% 32% 29% 30% 30% 37% 27% 38% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 SOCIAL SCIENCES 7 11 5 6 4 4 5 6 2 1 NATURAL SCIENCES - - - - - - - - 5 3 ECON 26 32 34 35 36 40 37 45 45 41 HUMANITIES 4 5 2 4 1 4 1 5 2 - ORFE 13 22 17 13 24 24 27 30 16 18 ENGINEERING 8 5 9 8 11 12 18 9 12 12 WWS 5 4 3 6 6 7 6 4 3 2 TOTAL UCF 63 79 70 72 82 91 94 99 85 79

What does the certificate accomplish? • The certificate teaches you the main methods employed in finance • It will attest to your proficiency in finance • Upon graduation you will receive your degree (A.B., B.S.E.) as well as the finance certificate

How do I obtain the UCF? • 3 Prerequisites – Mathematics – Microeconomics – Probability and statistics • 2 core courses in finance • 3 additional electives • Senior thesis must be finance related or separate finance independent work

Prerequisites Microeconomics, Mathematics, Probability and statistics MAT 175 or higher {MAT 201 & 202 or MAT 203 & 204} ECO 300 or ECO 310 ECO 202 / ORF 245 / PSY 251 / SOC 301 / POL 345 / WWS 200 PHY 301 & PHY 312 or a score of 5 in AP Statistics (must be on your transcript)

Minimum grade requirements Prerequisites: 2 Core Microeconomics + 3 Electives: Statistics Minimum C+ average Math Additional minimum grade requirements for ECO & ORF majors: B- average on the prerequisites and C+ average on the two core courses

ECO202 APStats Statistics and Data Analysis for Score = 5 Economists PHY301/ PHY312 Statistical ORF245 Mechanics Fundamentals of and Politics Engineering Statistics Statistics Requirement WWS200 Statistics for Social Science PSY251 Quantitative POL345 SOC301 Methods Quantitative Sociological Analysis Research and Politics Methods

Microeconomics and Mathematics • Micro – ECO300: Microeconomic Theory – ECO 310: Microeconomic Theory: A Mathematical Approach • Math – MAT 175: Mathematics for Economics / Life Sciences – or higher…for example, MAT 201 and MAT202 or MAT 203 and MAT 204 – AP Math courses not eligible

Core Courses ECO 362 Financial Investments Fall Term Only ECO 363 Corporate Finance and Financial Institutions Spring Term Only

3 Elective Courses List 1 Electives List 2 Electives Financial General Methodology Applications for Finance Note: At least 2 of the 3 electives must be from List 1 for ECO and ORF Majors; 1 for others.

List 1 - Financial Applications • ECO 315: Topics in Macroeconomics • ECO 342: Money and Banking • ECO 344: Macroeconomic Policy • ECO 353: International Monetary Economics • ECO 361: Financial Accounting • ECO 461: Entrepreneurship, Innovation, and Venture Capital • ECO 462: Portfolio Theory and Asset Management • ECO 463: International Financial Markets • ECO 464: Corporate Restructuring • ECO 465: Options, Futures and Financial Derivatives • ECO 466: Fixed Income: Models and Applications • ECO 467: Institutional Finance • ECO 468: Behavioral Finance • ECO 469: Valuation and Security Analysis • Cases in Financial Risk Management ECO 491: • ECO 492: Asian Capital Markets • ECO 493: Financial Crisis • ECO 494: Chinese Financial and Monetary Systems

List 1 (cont.) • EGR 395: Venture Capital and Finance of Innovation • EGR 475: Building and Operating Complex and Regulated Ventures • EGR 491: High-Tech Entrepreneurship • ORF 335: Introduction to Financial Mathematics • ORF 435: Financial Risk Management • ORF 474: Special Topics in Operations Research and Financial Engineering • WWS 466: Financial History • WWS 524: Advanced Macroeconomics • WWS 582f: House of Debt: Understanding Macro & Financial Policy

List 2 – Methodology for Finance • APC 350: Introduction to Differential Equations • CEE 460: Risk Assessment and Management • COS 318: Operating Systems • COS 324: Introduction to Machine Learning • COS 333: Advanced Programming Techniques • COS 423: Theory of Algorithms • COS 424: Fundamentals of Machine Learning • COS 432: Information Security • COS 436: Human-Computer Interface Technology • COS 445: Economics and Computing • COS 461: Computer Networks • ECO 311: Macroeconomics: A Mathematical Approach • ECO 312: Econometrics: A Mathematical Approach • ECO 313: Econometric Applications • ECO 317: The Economics of Uncertainty • ECO 365: Introduction to Empirical Methodology in Finance • ECO 414: Introduction to Economic Dynamics • ECO 418: Strategy and Information • ECO 488: Applied Game Theory

List 2 (cont.) • MAE 305: Mathematics in Engineering I • MAE 306: Mathematics in Engineering II • MAT 325: Analysis I: Fournier Series and Partial Differential Equations • MAT 330: Complex Analysis with Applications • MAT 335: Analysis II: Complex Analysis • MAT 385: Probability Theory • MAT 486: Random Processes • ORF 307: Optimization • ORF 309: Probability and Stochastic Systems • ORF 311: Optimization under Uncertainty • ORF 350: Analysis of Big Data • ORF 363: Computing and Optimization for the Physical and Social Sciences • ORF 401: Electric Commerce • ORF 405: Regression and Applied Time Series • ORF 409: Introduction to Monte Carlo Simulation • ORF 455: Energy and Commodities Markets • WWS 340: Psychology of Decision Making

Course Substitution Approval for Electives • Courses not listed may be taken as an elective if approved by DUS: submit the request by e-mail and explain how the course relates to your program of study in finance • The two core courses must be completed at Princeton. • Students are permitted to use course(s) completed abroad to fulfill a maximum of one of their three elective courses with DUS approval

Not all courses are offered every year Check with the relevant department and registrar website to confirm course offerings

Senior Thesis If you are an ECO or ORF major • You must include a chapter in your senior thesis with significant finance content • And submit a copy by the senior thesis due date

Independent Work If you are NOT an ECO or ORF major: • You are encouraged to integrate finance into your junior independent work or senior thesis. • Alternatively, you can submit an independent paper (approximately 12-15 pages) as a separate independent paper with significant finance content • You may use the same independent work, including junior papers or senior thesis, to fulfill the finance certificate independent work requirement plus one other (your department’s requirement, or a different certificate’s requirement), but not more than one other.

Tracks: How to Select Electives Selection of electives is based upon: • Individual needs and preferences • Following a suggested track with courses forming a coherent group – Math Finance Track – Derivatives Pricing and Risk Management Track – Investment Management Track – Corporate Finance Track – Information Technologies for Finance Track – Behavioral Finance – Finance and Public Policy

Mathematical Finance Track • Consider this track if you are interested in financial engineering or the design of financial securities that help manage risk • You will study the mathematics of financial asset pricing – stochastic calculus – application of stochastic calculus to arbitrage and equilibrium in dynamic economies

Derivatives Pricing and Risk Management Track • Consider this track if you are interested in risk management and financial engineering • You will learn – how to price options, futures and other derivative securities – how to use these securities to manage risk