The objective of this course is to provide the principles of asset valuation and financing in competitive global financial markets. The course is organized around the three main ideas in Finance: The time value of money, Diversification and risk, Arbitrage and hedging. The time value of money is a basic determinant in the valuation of assets such as bonds, stocks, futures, and options. The classes on diversification and risk provide a thorough grounding in the trade-off between risk and return given by modern portfolio theory. In discussing arbitrage and hedging, we demonstrate how to hedge market risk, interest rate risk, and foreign exchange risk. This involves using futures and options.