- Your Overview of the Financial Market
- The different markets and instruments
- FX/fixed income/equity markets
- Cash, derivatives
- Domestic and international markets
- Learning the Role of the Participants
- Buy side
- Banks
- Participants and market place
- Review of Fixed Income Mathematics
- Time value of money
- Relationship between price, coupon and
yield to maturity
- Yield measures
Exercise: Different yield calculations
- Understanding the Bond Markets
- Different bond types
- Major sovereign bond markets
- Eurobond market
- Yankee and Brady bond market
- The high yield bond market
- The importance of rating agencies
- Pricing of New Issues of a Corporate Borrower
- Trading techniques in fixed income
- Long/short positions
- Switches (yield/credit/liquidity)
- Spread trading and complex structures
- Arbitrage
- Short term trading vs positioning
Exercise: Putting on an inter-country trade
(switching)
- Bond Risk Management
- Risk aspects of fixed income securities
- Duration, convexity
- Volatility measures
- Hedging aspects
Exercise: How to hedge a portfolio of securities
using duration
- The Repo Market
- Repos and reverse repos
- Applications of repos
- Risk and rewards in the repo market
- An Introduction to the Equity Markets
- Characteristics of equities
- Equity valuation
- Equity derivatives
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- Aspects of Equity Portfolios
- Modern portfolio theory
- Asset allocation
- Performance of portfolios
- The Foreign Exchange Market
- Understanding the role of the FX market
in the economy
- Emerging currencies
- Markets: size, liquidity and volatility
Exercise: Calculating forward rates
- Interest Rate Derivatives
- Futures and forward rate agreements
- Currency options
Exercise: Pricing an FRA
- Fully Understanding Futures
- Characteristics of futures
- The futures market
- Risk management issues
Exercise: Calculations of margins for different
participants
- Getting to Grips with Options
- Option definition and characteristics
- Option strategies
- Option pricing models
- Introduction to exotic options
- An Introduction to Swaps
- Instruments, pricing issues
- Risk management issues
Exercise: Constructing a currency swap for
a new issue
- Credit Derivatives
- Instruments
- Default options
- Participants and market
- Risk issues
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