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BaruchCollege, ZicklinSchool of Business, CUNY

Equity Markets: Trading and Structure, FIN 4730 KM13, Fall 2009

Instructor:Professor Robert Schwartz, 646-312-3467

Vertical Campus, 10th floor, room 268,

Office Hours:Monday and Wednesday, 3:00 – 5:00 and by appointment

Classroom:Vertical Campus, 14-230

Class Time:Monday and Wednesday, 11:10am-12:25pm

COURSE DESCRIPTION:The course is designed to give students a broad understanding of the operations of equity markets, and an in depth knowledge of liquidity, market structure and trading. In equity markets around the world, investors are increasingly concerned with controlling transaction costs, and innovative trading technologies have been introduced. In this context, the course focuses on the operations of exchanges, trading systems and broker/dealer intermediaries, and on the impact of computer technology. Students will evaluate a spectrum of issues regarding the formulation of trading decisions, market structure design, and market structure regulation. Simulation software is used to provide hands-on experience with making tactical trading decisions in different market structure environments. Prerequisites: FIN 3610, 3710 and ECO 4000, and a GPA of 2.0 or better in FIN 3610, 3710 and ECO 4000

3 Hours, 3 Credits.

LEARNING GOALS

Analytical and Technological Skills / Students will possess the quantitative, technological, analytical and critical thinking skills to evaluate issues faced in business and professional careers.
To this end, the students will evaluate a spectrum of issues regarding the formulation of trading decisions, market structure design, and market structure regulation. Implications for portfolio management will also be discussed.
Global Awareness / Students will know how differences in perspectives and cultures affect business practices around the world.
References will be made to non-U.S. exchanges (mainly in Europe). Contrasts and parallels between various country-specific approaches to equity trading will both be made.
Proficiency in a Single Discipline / Students will possess a deep understanding of and intellectual competence in at least one business discipline.
Major attention will be given to key economic issues that underlie equity trading. Students will acquire an in-depth understanding of economic concepts such as market efficiency, performance evaluation, and public policy regarding market structure regulation.

GRADING:

Midterm Exam25%

Final exam 75%

STATEMENT ON ACADEMIC INTEGRITY:

I fully support BaruchCollege's policy on Academic Honesty, which states, in part:

"Academic dishonesty is unacceptable and will not be tolerated. Cheating, forgery, plagiarism and collusion in dishonest acts undermine the college's educational mission and the students' personal and intellectual growth. Baruch students are expected to bear individual responsibility for their work, to learn the rules and definitions that underlie the practice of academic integrity, and to uphold its ideals. Ignorance of the rules is not an acceptable excuse for disobeying them. Any student who attempts to compromise or devalue the academic process will be sanctioned."

Academic sanctions in this class will range from an F on the assignment to an F in this course. A report of suspected academic dishonesty will be sent to the Office of the Dean of Students. Additional information and definitions can be found at

CLASS MATERIALS

  • Text: The Equity Trader Course, Robert A. Schwartz, Reto Francioni and Bruce W. Weber, John Wiley & Sons, 2006.
  • PowerPoint Presentations will be posted on Black Board.
  • Additional readings will be posted on Black Board or made available on e-reserve.

COURSE OUTLINE: Approximate

Topic Reading No. of Sessions

1. Introduction to Equity Trading1 session

2. Introduction to Trading SimulationText Chapter 11 sessions

3. Prices, Returns and Trading CostsText Appendix2 sessions

4. Performance MeasurementText Chapter 72 sessions

5. LiquidityText Chapter 23 sessions

6. Order Driven MarketsText Chapter 33 sessions

7. Call & Continuous TradingText Chapter 43 sessions

8. Market Intermediaries and Block TradingText Chapter 53 sessions

9. Technical Analysis & Algorithmic TradingText Chapter 62 sessions

10. Market Structure Regulation(To be posted on Blackboard)1 session

11. Simulation Trading Sessions6 sessions

Midterm1 session

Total Sessions28

*Each simulated trading session will be heldatthe Wasserman Trading Floor – SubotnickCenter. The dates will be announced in class and posted on Blackboard.

COURSE SCHEDULE:

8/31 First Day of Classes / 10/21 Wasserman Trading Floor – SubotnickCenter
9/2 / 10/26
9/7 Labor Day – College Closed / 10/28 MIDTERM EXAM
9/9 / 11/2 Wasserman Trading Floor – SubotnickCenter
9/14 Wasserman Trading Floor – SubotnickCenter / 11/4
9/16 / 11/9 Wasserman Trading Floor – SubotnickCenter
9/21 / 11/11
9/23 / 11/16 Wasserman Trading Floor – SubotnickCenter
9/28 No classes scheduled / 11/18
9/29 Classes follow a Monday Schedule / 11/23
9/30 / 11/25
10/5 / 11/30
10/7 Wasserman Trading Floor – SubotnickCenter / 12/2 Wasserman Trading Floor – SubotnickCenter
10/12 Columbus Day; College Closed / 12/7
10/14 / 12/9 Last Class
10/19 / 12/21 FINAL EXAM 10:30AM TO 12:30PM