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Core courses

Students on the MPhil in Finance programme's Finance specialisation take the following core courses:

Asset Pricing I & II

This two-part course in asset pricing, one of the building blocks of finance, covers models that determine security prices and the methodologies used to empirically test their predictions. The course mixes theoretical and empirical lectures, with fifteen sessions over two terms.

Asset Pricing I & II requires a strong prior background in microeconomics and statistics/econometrics.

Corporate Finance I & II

Structured by topics, this course introduces you to theoretical and empirical research in corporate finance. Each topic examines the fundamentals of corporate finance theory (e.g. the theory of the firm's choice of its capital structure and dividend policy under alternative assumptions), as well as various essential areas in corporate finance (e.g. the notion of moral hazard and agency problems, adverse selection and signaling). The course further covers the related empirical evidence with a focus on recent research in empirical corporate finance and a critical assessment of the research design in empirical studies.

The course requires some basic knowledge of fundamental concepts in corporate finance (at the level of Brealey, Myers and Allen's Principles of Corporate Finance). We will recommend some summer reading as preparation to the course for those admitted to the MPhil.

Fundamentals of Competitive Markets

You are introduced to the foundations necessary to conduct research in the three areas of marketing, operations & technology management, and finance, with a view to developing your own skills as researchers in these areas and in business in general. This course covers standard models of:

  • individual choice under certainty and uncertainty
  • production theory
  • general equilibrium
  • monopoly pricing, price discrimination
  • information economics
  • behavioural economics

The course gives you some fundamental knowledge of competitive markets, enabling you to leverage your course knowledge to do original research and write papers in your chosen field of research in a business school.

choice of one of the following two courses:

Econometrics I

This course introduces you to the variety of quantitative research methods available for applied research in management and economics, providing you with sufficient background to choose techniques and methods suited to different data-sources and models. The focus is on the way techniques relate to theory, and on the insights that can be drawn from their application. We are concerned with the interpretation and appraisal of results, and emphasise applied work.

Topics covered include:

  • The paradigm: underlying "structure" and "true" models of phenomena
  • Probability distributions
  • Descriptive statistics
  • Estimators and their properties
  • Testing hypothesis
  • Confidence intervals
  • Simple and multiple regression
  • Properties of regression coefficients
  • Transformation of variables
  • Linearity, nonlinearity and categorical variables
  • Simultaneous equations
  • Time series models
  • Stationary and nonstationary processes
  • Estimation

Econometric Methods

Taught by the Faculty of Economics (course code M300).

This course examines:

  • Least squares
  • Large sample analysis
  • Maximum likelihood
  • Test procedures
  • Time series
  • Estimation and tests
  • Nonstationary and cointegrated regression
  • Computer packages

choice of one of the following three courses:

Cross Section & Panel Data Econometrics

Taught by the Faculty of Economics (course code M320).

This course consists of lectures dealing with estimation and inference using both cross-section and panel data. Topics include:

  • Linear unobserved effects panel data models
  • Discrete choice I: multinomial models
  • Discrete choice II: the mixed logit model
  • Generalised method of moments I
  • Econometrics of demand systems for differentiated products
  • Dynamic panel data models
  • Count data models
  • Simulation based inference: classical and Bayesian
  • Panel data discrete choice models

You must have taken the Econometric Methods course if you wish to take this course.

Econometrics II

Given the extensive availability and use of individual-level data sources for applied quantitative analysis, it has become increasingly important to understand the techniques available in applied research, their relation to theory, and what insights can be drawn from the estimation of models.

Many of these methods move beyond the standard tools of econometric analysis, in order to exploit the richness or structure of large sources of either cross-section or longitudinal data, or to compensate for some partial observability of data, or to build complexities in decision-making into an empirical study.

This course provides you with sufficient background to choose techniques suited both to the data-source and the model. There is an emphasis on the interpretation and critical appraisal of estimates, as well as on applied work, exploiting the availability of computer techniques for solutions.

Topics covered include:

  • Binary choice
  • Multiple choice and ordered response models
  • Limited dependent variable techniques
  • Duration and survival models
  • Panel data estimation methods
  • Nonparametric and semiparametric regression methods
  • Count data models

You must have taken the Econometrics I course if you wish to take this course.

Further Time Series with Applications in Finance & Macroeconomics

Taught by the Faculty of Economics (course code M310).

Topics include:

  • Time series analysis
  • Models and forecasting
  • Stationary stochastic processes
  • Estimation and testing
  • Time series models
  • Dynamic regression
  • Nonstationarity and co-integration
  • Nonlinear models and financial time series
  • State space models and the Kalman filter
  • Spectral analysis
  • Trends and cycles in macroeconomic time series
  • Macroeconomic models

You must have taken the Econometric Methods course if you wish to take this course.

Closing dates

Deadline for applications: 1 Mar 2018
However we recommend you apply before December.

Cambridge Trusts funding deadlines are 11 October for Gates US applicants, 6 December for applicants from all other countries.

Scholarships

Funding available to our MPhil in Finance students includes University of Cambridge scholarships, Cambridge Judge Business School bursaries and external scholarships.

Find out more about scholarships