This unit focuses on an analysis of Australian and International Capital Markets. This involves a more advanced treatment of topics than in the undergraduate units. The objective of the course is to provide a deeper understanding of: the role and nature of capital markets, characteristics and attributes of instruments traded in them, pricing and hedging of these instruments, nature of financial intermediation and the role of financial institutions. These activities will be set in the context of the factors driving innovation and change in international capital, the role of market regulators and the measurement of risk institutional and systemic risk within markets; particular attention will be paid to the Basel Accords and the modelling of Value at Risk (VaR). Developments of new products such as reverse mortgages and ‘new’ industry sectors such as the hedge fund sector will be analysed.  Market architecture and market microstructure issues will be introduced and the impetus of technical change such as the continuing advance of ecommerce and electronic delivery systems. The emphasis is upon the use of the original papers and reports. This should build an awareness of both the strengths and limitations of the models and methods used currently in this branch of financial economics.