International Finance

To understand the principles, and concepts of international corporate finance. This module emphasises economic principles like parity conditions and the puzzle effect on carry trade.

To extend corporate finance into the global context by studying the economic, fiscal currency and political environment in which international companies operate and the methods and techniques they use to manage their operations

An in-depth understanding of the specific issues in international corporate finance

Understand the role of international financial markets, financial problems faced by multinational firms when undertaking international trade and investment, and the financial strategies used by multinational firms to alleviate problems posted by pricing and political risk.

It is assumed that you already know the basic principles of corporate finance, like valuations.

Global Financial Environment

This is covered in the first five chapters of the book. Globilisation and the multi-national enterprise is covered in Chapter 1.  There is an explanation of Ricardo’s theory on page 7.  Financial goals in Chapter 2 revises the work you studied in Corporate Finance.  The international monetary system is covered in Chapter 3, while the balance of payments account is explained in Chapter 4.  The market for foreign exchange is discussed in Chapter 5. 

Foreign Exchange

International parity relationships are in Chapter 6.  Foreign exchange rate determination and forecasting in Chapter 7, followed by Foreign currency Derivatives in Chapter 8
Foreign exchange exposure

During this course you will learn to manage Transaction operating and Translation exposure (Chapters 9, 10  and 11).The basic ideas of hedging will be introduced.

Financing the global firm

We will cover Chapters 12, 13, 14 and 15 in the text book.

International Investment decisions

Chapters 16 , 17, 18 1nd 19 cover portfolio theory, Foreign direct investments, Political risks and multinational budgeting.

Managing multinational operations
This section covers International trade (Chapter 20), Tax management (Chapter 21) and Working Capital Management (Chapter 22)
From this it is obvious that you must know the whole book.  During the lectures certain points that are more important will be emphasised.

On successful completion of this course, the student will be able to:

  • demonstrate a critical awareness and understanding of International Finance at the master's level that provides a basis for developing and/or applying new ideas, often within a research context.
  • apply knowledge, critical understanding, and problem-solving abilities in new or unfamiliar environments within broader (or multidisciplinary) contexts related to their field of study (International Finance)
  • assimilate knowledge and formulate opinions with incomplete or limited information, but that include a reflection on social and ethical responsibilities.
  • communicate their assumptions, and knowledge regarding International Finance and the rationale underpinning these, to specialist and non-specialist audiences clearly and unambiguously.
  • use the acquired skills to allow them to continue to study in a manner that may be largely self-directed and autonomous.
  • integrate knowledge from other courses of the master program and practical business and formulate critical judgments with incomplete data.

The course is offered as self-study in e-learning. The learning material is provided in the form of lectures, literature, and lecture notes. Independent learning is required. In the case of paper submissions, further research is expected in compliance with the given scientific standard. LIVE course sessions are offered to support the students with questions regarding the content. Students are supported in their scientific work by corresponding online seminars.

All lectures and learning materials are made available in the online campus GHU Campus. All lectures are recorded and are available for download 24/7. The lecture notes, as well as additional material provided by the lecturer, can also be accessed in the GHU Campus.

Documents for exam preparation consisting of lectures and lecture notes. Additional material provided by the lecturer serves as independent files and can be used to work on the exams. The examination comprises theory questions, reflection, and case study and is intended to confirm all learning objectives.

The assessment consists of a 5000-word International Finance homework and assesses all learning outcomes. As a master-level assignment, the homework requires a command of a complex and specialized area of knowledge and skills. This implies that, in addition to demonstrating a sound grasp of the ideas and concepts relevant to the topic of thehomework, students will show that they can evaluate aspects such as conventions of approaches, their internal consistency, relevance, and applicability, as well as strengths and weaknesses.

To reach an assessment, students will consider competing approaches and draw on critiques put forward in scholarly literature. The position adopted in the assignment and any claims made must be based on a careful, coherent, and logical arguments, need to be appropriately supported with evidence from relevant scholarly sources, and should be presented in a coherent piece of writing. Sources must be referenced appropriately in-text and in a quote/reference list as set out in the GHU Referencing Guidelines.

Jan Walters Kruger

- Univ.-Prof. -