Financial technology (Planned autumn 2021)
Complete course description will be ready summer 2021.
The economy needs to allocate capital to its different uses. This allocation is crucial both for investments, and hence economic growth, and for risk sharing and management. The Financial System provides a schematic overview of this process.
New technology was early adopted to elements and links of the Financial System, like intermediating loans in the banking industry, or how the market place is organized for specific financial markets.
In this course we study how technology has been applied to finance, and its possible consequences. We will cover topics like new ways to distribute loans; new trading platforms in financial markets; new trading strategies, like HFT; new methods like collecting big data and analyzing using machine learning methodology. We also cover topics around financial innovations, like blockchain and cryptocurrencies.
Classes may cover sessions with discussions on topics like: potential for further digitalization; how to do HFT; potential for new financial products (e.g motivated by Shiller’s book); dig into e.g Bloomberg or web to find interesting data. These sessions may be organized in groups.
- Lecture 1: Overview: Digitalization and the Financial System.
- Identify the “boxes” that has been digitalized
- Implications within the Fin System
- Lecture 2-3: Digitalization of Financial Institutions:
- Briefly on banking
- Digitalization in Intermediation: C2C borrowing
- Lecture 4-7: Digitalization of financial markets
- Briefly on markets (market microstructure)
- Digitalization and market access. New participants and trading venues
- Trading technology: Liquidity (Limit order books)
- Trading technology: Efficiency
- Trading technology: High Frequency Trading
- Big data:
- Machine Learning
- Lecture 8-11: Financial innovations:
- Tailoring products based on bid data
- Blockchain and crypto-currencies.
- Lecture 12: Summary