Loyola University Chicago

Quinlan School of Business

Risk Management

The MBA with a risk management concentration offers you the opportunity to study in Loyola's newest discipline. Calculating and mitigating risk is top of mind for today's senior executives. This concentration focuses on the latest principles and practices for appropriately leveraging business opportunities. We offer you hands-on learning, often in partnership with recognized local businesses, as well as a global perspective on current issues.

Elective Courses

Choose three of the following courses (from at least two different disciplines) in order to obtain a risk management concentration.

Courses (3)

This course explores the emerging practice of "enterprise risk management" (ERM) or "integrated risk management"-a new managerial outlook on managing risk. Enterprise risk management considers all the risks faced by the firm and attempts to integrate these disparate risks into a single unified analytical framework. Traditionally, risk has been managed in the compartments of financial risk, operating risk, and credit risk. Rather than allowing risk to remain in such "silos," ERM insists that these must be brought together into one system of risk management. 
Outcome: Upon completing this course, students will have a greater understanding of the nature of risk that affect the entire enterprise and they will be able to analyze risk is a more systematic and rigorous manner.

Students are introduced to a plethora of financial derivatives, including both exchange-traded and OTC products, and then learn to use these products to hedge interest rate and other risks largely through the study of cases and detailed examples emphasizing the formation and use of synthetic positions.

Outcome: Students will be able to demonstrate an understanding of a wide variety of derivative products, as well as be able to use these products to manage interest rate and other risks.

This course is an introduction to options, futures, forwards and swaps as derivative securities. After an overview of these securities, a detailed examination of the methods of valuing options will be presented. Binomial trees and a discussion of the Black-Scholes option pricing model will be emphasized, followed by insights into option contracts as useful risk management instruments. A brief introduction to stochastic calculus is also given. Stock, index, debt, commodity, foreign currency and futures options are reviewed, and option strategies are analyzed as managerial tools in financial decision-making. Skills developed in this course include analytical and decision-making, creative thinking and communication. Throughout the course the notion of risk both as potential loss and opportunity for gain and its management will be highlighted. Ethical and social dimensions of risk management and the use and abuse of derivative securities will be emphasized to help students become responsible financial managers. The recent credit crisis and its origin in subprime mortgages will be reviewed. Students are encouraged to form teams and work jointly on five sets of homework problems and to also develop trading strategies. The course integrates functional areas in finance, accounting, economics, business ethics and quantitative methods.

This is an advanced course in valuation where students are given a thorough grounding in traditional valuation models (DCF and relative valuation) and also introduced to real option methods and ideas; a certain emphasis is placed on the valuation of start-ups and students are introduced to the venture capital markets.
Outcome:  Students will be able to demonstrate an understanding of traditional valuation models as well as real options methods and ideas.