This is a module of two halves. The first half introduces some basic econometric techniques, and the problems which arise in their use. The second half applies the skills acquired in the first half, to particular problems in financial economics such as the capital asset pricing model, exchange rate forecasting, testing the efficient markets hypothesis, modelling non-constant volatility and estimation of VAR models. With the aid of the specialist econometric software package STATA, theoretical models are estimated and tested using real data.