Syllabus

Title
5857 SME - Course 3: Internationalization & FOREX Management
Instructors
Assoz.Prof. PD Dr. Jakob Müllner
Contact details
Type
PI
Weekly hours
2
Language of instruction
Englisch
Registration
02/11/21 to 02/18/21
Registration via LPIS
Notes to the course
Dates
Day Date Time Room
Monday 03/01/21 01:00 PM - 02:00 PM Online-Einheit
Monday 05/03/21 02:00 PM - 06:00 PM Online-Einheit
Monday 05/10/21 02:00 PM - 06:00 PM Online-Einheit
Monday 05/17/21 02:00 PM - 06:00 PM Online-Einheit
Tuesday 05/25/21 02:00 PM - 06:00 PM Online-Einheit
Monday 05/31/21 02:00 PM - 06:00 PM Online-Einheit
Monday 06/07/21 09:00 AM - 11:00 AM Online-Einheit
Contents

Just like large multinational corporations, SMEs venturing in international markets face liability of foreignness. Unlike MNEs, however, SMEs are less diversified, dispose of fewer resources and commonly have less knowledge about foreign markets. Hence, the liability of foreignness is exacerbated by, what could be referred to as “liability of smallness”.

To overcome these liabilities, internationalizing SMEs require a clear strategy and professional risk management. These country-related risks include, but are not limited to credit risk, political risk and socio-cultural risks. Most importantly, SMEs internationalizing into foreign markets face exchange rate risks. Despite disproportional exposure to exchange rate risks, “Many SMEs fail to grasp foreign exchange risk. (Bolshaw, 2013)”. In a study conducted by Giambona et al. (2018), 48% of non-financial firms rate foreign exchange risk as the most important or a material risk in international business.

The course covers SMEs’ risks in internationalization with particular focus on the financial and strategic management of exchange rate risks. This course is designed to teach students (a) the theoretical frameworks necessary to understand exchange rates' effects on firms (b) familiarize them with internal, contractual, external and strategic hedging instruments and (c) systematically reflect on the challenges of SMEs operating in multiple currency areas.In addition to these traditional treasury strategies, the course includes an extensive discussion of organizational issues in SME risk management and long-term strategic remedies for reducing the risks of internationalization.

Learning outcomes

After concluding the course students

  • have a fundamental understanding of exchange rate determination and forecasting on a macro-economic level
  • are familiar with exchange rate quotation customs
  • have a detailed understanding of different exchange rate exposure concepts (book exposure, transaction exposure and economic exposure)
  • can analyze the corporate hedging process in SMEs from a theoretical perspective
  • can implement simple internal and contractual strategies to mitigate foreign exchange risks in SMEs
  • can calculate and implemet more complex external hedging strategies (forwards, futures, options)
Attendance requirements

The course is an asynchronous distance course. No attendance required but students must conclude all online distance learning steps.

Teaching/learning method(s)

The course combines several learning components:

  • Classic lectures.
  • Online learning assignments after each class.
  • Bloomberg Course (more information in Session 5)
  • Final exam
  • Wiki - additional points
Assessment
  • Online learning assignments                                      40 %                weekly            

  • Final exam (individual):                                               40 %        

  • Bloomberg Course                                                      15 %               on Bloomberg Education 

  • Group project                                                                5 %                              

Prerequisites for participation and waiting lists

Registration follows LPIS system and the "Wartelisten" System.

Readings

Please log in with your WU account to use all functionalities of read!t. For off-campus access to our licensed electronic resources, remember to activate your VPN connection connection. In case you encounter any technical problems or have questions regarding read!t, please feel free to contact the library at readinglists@wu.ac.at.

Recommended previous knowledge and skills

Preliminary understanding of financial markets is beneficial.

Availability of lecturer(s)

Open office hours:

Tuesday 10:00 - 11:00 (D1 5th floor) - please register via e-mail

Telephone: Tel: +43-1-31336-4374

E-mail: jakob.muellner@wu.ac.at

Other

Bloomberg Education: https://www.bloomberg.com/professional/expertise/education/ 
Class Code: 6XVJ8LGP4Z

Last edited: 2021-02-19



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