Financial Markets

Group Work Project

MSc Financial Engineering
Table of Contents

1. Overview 2

2. Instructions 2

3. Research Topic 3

4. Submission Instructions 4

4.1 Submission 1: The Global Financial Crisis 4

4.2 Submission 2: Evaluation of Regulatory Response 4

4.3 Submission 3: The Role of Mortgage-backed Securities 5

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1. Overview

In every course of the WQU Master’s in Financial Engineering, students are required to complete a
group work project. Groups are geographically banded and consist of 3-5 students who are able to
communicate via a forum. All groups are given the same topic for their projects – a topic designed
to assess not only their understanding of the course content but also their skills of analysis and
application.

2. Instructions

You are required to submit three version of the group work project during the Financial Markets
course - at the end of Modules 3, 5 and 7, respectively. Within a week of these submissions, every
group will receive feedback from the course lecturer, enabling you to implement changes ahead of
the second and final submissions.

Your research should favor authoritative, scholarly sources, and you must cite all sources where
relevant. The task is not to reproduce the research of others, but instead to develop your own
systematic narrative that addresses the research topic and is informed by the research of others.
Not only are you required to cite accurate and relevant facts, but you should also present your
own clear logic when linking and contextualizing these facts.

For each submission date, you are only required to answer the relevant specified
question; however, it is important to approach all three with the overarching
topic in mind.
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3. Research Topic

What was the Global Financial Crisis, and what were the major policy and regulation
responses to it?

Your response to the topic should address the following sub-topics, however you are required to
integrate these sub-topics (amongst others) into a coherent narrative that addresses the research
question.

1 The primary causes of the Global Financial Crisis (also known as the financial crisis of
2007/8).
2 The market features and conditions that constitute a financial crisis in general.
3 How the primary causes of the Global Financial Crisis led to the features of a financial crisis.
4 The response of policymakers and regulators to the global financial crisis.
5 The intended effects of policymakers’ and regulators’ responses.
6 The downsides and unintended consequences that can occur when applying
regulation and policy to the financial markets.
7 The features of financial markets which often need regulation.

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4. Submission Instructions

4.1 Submission 1: The Global Financial Crisis

You are required to submit a 1000-word review article systematically describing the global financial
crisis, and the major policy and regulatory responses to it. The sub-questions below the main
research topic should help to break this general topic down into smaller ones. Recall, at the same
time, that the overarching logic and cohesion is an essential aspect of your submission.

4.2 Submission 2: Evaluation of Regulatory Response

You are required to submit a 2000-word review article which expands and improves upon
Submission 1.

Firstly, you must add a detailed description of one specific regulation. This must include i) a specific
outline of the regulation itself, ii) the intended effect of the regulation, and some context for why it
was deemed necessary, iii) an explanation of how this fits into the general theme and rationale
of financial regulation, and iv) a description of some of the possible downsides and/or intended
consequences of the regulation. You should conclude with a verdict on how ii) and iv) compare.

Secondly, you must incorporate feedback on your Assignment 1, and generally attempt to improve
the cohesion and clarity of your essay.

The structure and development should be refined, given the new regulation information you would
now include towards the end. The clarity of your explanations and structure should also
be improved, given what you have learnt during subsequent modules.

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 4.3 Submission 3: The Role of Mortgage-backed Securities

You are required to submit a 3000-word review article which expands and improves upon
Submission 2.

In addition, you must include a detailed description of mortgage-backed securities, in the context
of the Global Financial Crisis. This should include i) a detailed and specific outline of mortgage-
backed securities themselves, ii) an explanation of why they can be useful financial instruments, iii)
an explanation of the role they played in the Global Financial Crisis, and iv) a comparison between
ii) and iii), explaining why the potential benefits and uses of mortgage-backed securities did not
manifest in the Global Financial Crisis.

Secondly, you must finalize your earlier work into a professional review article with the following
structure: an abstract, keywords, an introduction, two-to-four core sections (used to structure
your research), and a conclusion. You should incorporate the feedback you have received, and
also apply the knowledge and context you have developed during the course. In addition to the
specific instructions (of including detailed descriptions of one regulation and of mortgage-backed
securities), your goal should be to address the research topic in the most clear, systematic and
thorough way possible.