Investment and portfolio management

This module covers the field of investment. It describes the main participants, their objectives and constraints, and the major investment markets. The module covers investment strategies for bonds, equities, and structured products including the use of derivatives in managing risk. Portfolio optimisation and asset allocation are covered, as well as how to measure portfolio performance. Ethical investment, the role of taxation, and behavioural investment biases are also explored in this module. By the end of the module you will be able to evaluate individual securities, investment strategies and portfolio performance in the context of investor objectives, constraints and behavioural biases.

What you will study

Modern finance theory offers sophisticated tools to allocate the investments to various financial assets. This module aims to equip you with the necessary knowledge and skills to construct, manage and evaluate the performance of portfolios of assets for individual and institutional investors.

At the end of the module you will be able to choose between different bonds, equities and structured products as well as make asset allocation decisions. You will also be able to decide on and know how to manage a diversified investment portfolio and its currency risk. You will also know how to measure the investment performance of a fund or portfolio as well as understand the fund management industry and the context in which investments are made.

The module also provides insights into the emerging field of behavioural finance that draws from psychological theories and tries to explain investment behaviour.

The following are the main topics covered in this module:

investment objectives and constraints
the investment market and its participants
managing bond and equity portfolios
alternative asset classes, including currency
the use of derivatives in investment management.
asset allocation
evaluation of portfolios (mutual funds, pension funds and other institutionally managed funds)
international diversification; investing in emerging markets
behavioural finance

You will learn

It will enable you to:

understand how to value financial securities including bonds equities and derivatives.
be aware of investment objectives and the constraints of different types of investors
understand the trade-off between risk and return for securities and portfolios
understand the different approaches to asset allocation
understand structured products, that is, combinations of securities and derivatives which deliver a particular risk /return combination
understand the various risks inherent in investment and know how to use derivatives and other products to hedge (mitigate) such risks.

Vocational relevance

Investment and portfolio management is of particular relevance to those working, or intending to work, in the investment management sector, whether as an investment intermediary or in a banking or fund management role. The module will also provide you with skills you will use in obtaining professional qualifications and may allow you exemptions from part of such qualifications. The module is also of general interest to those wishing to learn how portfolio and investment management is carried out in practice.

Entry

All entrants must hold a BA/BSc degree awarded by a recognised university, or equivalent.

Various higher education and professional qualifications are considered equivalent to a degree. If you hold a qualification that you believe is an equivalent level to a UK degree you should contact us. The Open University Business School Masters Programme Committee is responsible for judging whether applicants’ qualifications meet the requirements for admission.

You will also need an appropriate facility in English language, sufficient to be able to work effectively at postgraduate level; generally this means capability equivalent to an International English Language Test System (IELTS) score of 6.5. To assess your English language skills in relation to your proposed studies you can visit the IELTS website. If you think either of these possibilities may apply to you, please speak to an adviser.

It is strongly recommended that you are comfortable with the use of numerical methods and use of spreadsheets. If you are unsure about these skills we suggest you familiarise yourself with illustrative numerical skills and methods prior to study. To help you decide whether you are ready, you may want to try this diagnostic quiz.

If you have any doubt about the suitability of the course, please contact us.

Qualifications

B861 is an optional module in our:

If you have a disability

This module is delivered online and time spent using a computer and the internet will therefore be extensive. Written transcripts of any audio components are available, as are printable versions of the online text-based material. Some online material may not be available or fully accessible using a screen reader (and mathematical and scientific materials may be particularly difficult to read in this way). Alternative formats of the study materials may be available in the future. Our Services for disabled students website has the latest information about availability.

Study materials

What's included

An extensive variety of specially written resources presented in different media and designed exclusively for this module. Audio-visual material, published articles, case studies and access to The Open University library.

Computing requirements

Primary device – A desktop or laptop computer. It’s possible to access some materials on a mobile phone, tablet or Chromebook; however, they will not be suitable as your primary device.
Peripheral device – Headphones/earphones with a built-in microphone for online tutorials.
Our OU Study app operates on supported versions of Android and iOS.
Operating systems – Windows 11 or latest supported macOS. Microsoft will no longer support Windows 10 as of 14 October 2025.
Internet access – Broadband or mobile connection.
Browser – Google Chrome and Microsoft Edge are recommended. Mozilla Firefox and Safari may be suitable.

Teaching and assessment

Support from your tutor

Your tutor will help you with the study material, mark and comment on your assignments and provide advice and guidance. You will contact your tutor by email, phone or via your tutor group forum on the module website.

Assessment

The assessment details for this module can be found in the facts box above.

You must use the online eTMA system to submit your tutor-marked assignments (TMAs).

Future availability

Investment and portfolio management starts once a year – in May. This page describes the module that will start in May 2023 when we expect it to start for the last time. A replacement module is planned for May 2024.

Regulations

As a student of The Open University, you should be aware of the content of the academic regulations which are available on our Student Policies and Regulations website.