Principles of Portfolio Management and Corporate Finance

Introduction:

The Principles of Portfolio Management and Corporate Finance course equips executives with essential tools to ensure that financial decisions enhance, rather than diminish, company value. This program is vital for safeguarding the firm’s integrity, its employees, and the broader economy. The portfolio management course provides foundational concepts in financial markets and portfolio management.

Spanning five days, this course covers crucial financial management decisions faced by senior executives, including financing methods, firm/project evaluation, and surplus cash distribution to investors. The initial two days focus on the analysis of financial instruments and equity portfolio strategies.

Objectives:

By the end of the Principles of Portfolio Management and Corporate Finance course, participants will be able to:

• Identify top portfolio management options to enhance professional credibility.
• Gain comprehensive understanding of various financial instruments.
• Explain portfolio management strategies, with emphasis on active vs. passive management.
• Address challenges in securing long-term and short-term funds.
• Utilize advanced techniques for investment project evaluation.
• Address stakeholder remuneration demands.
• Explore opportunities for further learning through portfolio management course.
• Access free and paid resources for mastering portfolio management fundamentals.

Training Methodology:

• Workshops
• Case studies
• Simulations
• Group work
• Role plays
• Guest lectures
• Working with financial statements
• Tests & quizzes

Course Outline:

Unit 1: Debt Securities and Equity Securities

• Analyze different debt and equity instruments.
• Compare risk and return of equity vs. debt instruments.
• Methods for bond evaluation and stock valuation.
• Asset valuation in passive management.
• Formulating an active approach to equity portfolio management.

Unit 2: Derivatives and Alternative Investments

• Investigate the nature of derivatives.
• Use futures and options for risk reduction and return enhancement.
• Pricing methods for derivatives.
• Advantages and disadvantages of alternative investments.

Unit 3: Short and Long-Term Financing

• Financing strategies aligned with organizational objectives.
• Optimal capital structure considerations: theory vs. practice.
• Initial public offering (IPO) theory, structure, and practice.
• Merits and limitations of public offers and debt finance.

Unit 4: Methods of Investment Evaluation and Estimation of Company Worth

• Understand the weighted average cost of capital (WACC).
• Project evaluation models: sensitivity analysis, net present value, internal rate of return, payback, and modified payback methods.
• CFO insights on investment appraisal methods.
• Valuation using free cash flow method and real options.

Unit 5: Allocation of Excess Earnings

• Decision-making regarding top management pay.
• Share options in remuneration packages.
• Dividend policies and their practical implementation.
• Financial considerations in mergers and acquisitions.