Essential MOOCs In Business For March

Asset Pricing, Part 2

School: University of Chicago

Platform: Coursera

Registration Link:  Asset Pricing – Part 2

Start Date: March 29, 2015 (6 Weeks Long)

Workload: 10-15 Hours Per Week

Instructor: John Cochrane

Credentials: Cochrane teaches asset pricing and economics courses at the Ph.D. level (and an advanced investment course in the MBA program) at the University of Chicago’s Booth School of Business. A Ph.D. from the University of California-Berkeley, Cochrane is best known for Asset Pricing, one of the premier textbooks in the field. Outside of Booth – where he has taught over 20 years – Cochrane is a research associate at the National Bureau of Economic Research, a former President of the American Finance Association, and a former editor of Journal of Political Economy. He is also the recipient of Booth’s Faculty Excellence Award for MBA Teaching.

Graded: Students can receive a verified certificate for successfully completing the course for $49.

Description: The follow up to Cochrane’s January course, part two ”explores some classic applications [of asset theory] including the Fama-French three-factor model, consumption and the equity premium, and extends the theory to cover options, bonds, and portfolios.” In particular, the course will cover the following concepts over six weeks: factor pricing models in action; time series predictability volatility and bubbles; macroeconomics and asset pricing; option pricing; term structure models and facts; and portfolio theory. As before, the course will include weekly reading assignments, lecture videos, problem sets, and quizzes. The course will conclude with a final exam.

Review: No reviews. Here is a review for part I: “I have seen most of the materials before, but it was explained exceptionally well. Furthermore, the exercises are spot on and really add to the understanding of the material. Highly recommended if you work in asset pricing.”

Additional Note: To complete the mathematical component of this course, Cochrane recommends that students set up a free jstor account. In addition, he specifies the following: “This course uses concepts from finance, undergraduate applied mathematics, advanced undergraduate / beginning graduate level economics, and time-series econometrics. You should be able to use single and multivariable calculus, simple differential equations, matrix algebra, and basic statistics. You should be able to program simple simulations in a matrix programming language like Matlab, Octave, R, Python, etc. You should have some background in economics, including utility functions and maximization, and have worked with basic time-series econometrics, such as AR(1) models.”

For students who haven’t take the first part of the course, they will need familiarity with the following: “You should not be scared by simple dz and dt mechanics, the basic consumption model $$ u'(c_t) p_t = \beta E_t u'(c_{t+1} x_{t+1}) $$ and regression-based factor pricing models such as the CAPM. Watching some of the videos might be a good brush up.”