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Caltech Course Catalog / 2025-2026 Catalog / Courses 2025-26 / Financial Economics

SS 213 abc - Financial Economics

SS 213 abc

Financial Economics

9 units (3-2-4)   |  first term

Mathematical finance: Pricing financial derivatives, risk management, and optimal portfolio selection. Methods of stochastic, Ito calculus for models driven by Brownian motion. Asset pricing theory: Mean-variance theory, information economics, continuous-time finance and differential equations, intertemporal consumption-based asset pricing theories, recent developments in intermediary-based and behavioral asset pricing theories. Behavioral finance: Empirical facts about asset prices, investor trading behavior, and firm behavior. Psychology about investor preferences and beliefs. Behavioral finance models that explain empirical facts. Trading strategies implemented by hedge funds. Prescriptive behavioral finance that aims at helping individuals and institutions to make better financial decisions. Not offered 2025-26

Published Date: Aug. 15, 2025