Investment Management is the most important subject for MBA finance students. This subject is very essential because it deals with investments in the financial markets. There are various types of investments and various financial instruments are employed for this purpose. One has to possess knowledge of all investment avenues and financial instruments in order to become a good investor.
Understanding of all financial markets’ functioning is based on ones understanding of two subjects namely – Investment Management & Financial Services and Systems.
The subject begin with defining investment and ends with evaluation of various portfolio performances including mutual fund.
Earlier, this subject’s name was Securities Analysis and Portfolio Management. When the syllabus was changed in 2007, the subject got its present name i.e. Investment management. When the syllabus was again changed in 2010, the name, Investment Management, was retained with trifling changes.
Very vitally important concepts in the Unit – I of this subject are Fundamental Analysis and Technical Analysis. Whole investment game rests on these two concepts. If one understands these two concepts very well, then there is more probability that one can become successful investor. Though important concepts such as risk & return are also part of first unit, it is Fundamental and Technical Analysis, which are very very important.
Many books are written on Technical Analysis. Understanding technical analysis is not cakewalk. Many students will be under the impression that this is small and not important concept. But the truth is that almost all Fund Managers and Equity Analyst depend on Technical Analysis.
According to exam point of view this topic can be considered as not so important but for investing in financial markets, technical analysis plays crucial role.
This is a practical subject. From ever Unit you can expect one practical problem. One theory and practical question will be asked in every question. Earlier, from unit one also problems on portfolio risk and return were asked. But since 2 years the trend is for theory questions. It will be wise for students to practice the problems of portfolio risk and return as this topic is very important for making investment decisions. If you have not practiced practical problem, you need not worry as one theory question will be asked on what is difference between investment and speculation or Explain the importance and process of investment
BOOKS FOR INVESTMENT MANAGEMENT
- The best book for all units of this subject is by Alexander. G.J, Sharpe. W.F and Bailey. J.V, “Fundamentals of Investments”, PHI, 3/E. This book should be read in detail from the day one of the semester for better understanding of the subject. Reading important concepts from this book during exams is also very beneficial.
- Another good book is by Prasanna Chandra, “Investment Analysis and Portfolio Management”, TMH, 3rd Ed. The solved problems at the end of every chapter of this book will be very helpful for understanding of practical problems. A student can also depend on this book for theoretical concepts.
- One of my favourite book for theory concepts of this subject is Herbert. B. Mayo, “Investments: an Introduction”, Thomson – South Western. 9th Ed. This book also should be read from the beginning of the semester to get in depth understanding of the concepts
- The best book for those students who did not open any book till now to study this subject is by S. Kevin, “Security Analysis and Portfolio Management”, PHI. Though this book is very small and very concise it covers all important concepts of investment management syllabus. You will notice, even Spectrum model paper is bigger in size and pages compared to this text book. It would be wise to opt this text book over model paper.