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Duration 14 hours
Course Outline
Global Capital Markets
- Defining the 'financial marketplace'
- The historical evolution of today's global financial systems
- The influence of financial media
- The architecture of major capital markets:
- Exchanges, clearing houses, and regulatory bodies
- The contemporary rise in global investment flows
- Variations in stock exchange structures
- The positioning of stock exchanges in current markets
- Comparison of US, European, Middle Eastern, and Asian exchanges
Regulation of Financial Markets
- Capital adequacy requirements
- Basel I framework
- Basel II framework
- Basel III and its broader implications
- Regulatory drivers for new product development
Asset Classes and Their Markets
- Current trading instruments on stock exchanges
- Equities: common and preferred stocks
- Bonds: corporate and government issues
- Bond types: fixed-rate, floating-rate, zero-coupon, and the yield curve
- Money market instruments
- Currency markets
- Investor motives for buying and selling
- Income generation versus capital appreciation
- Interdependencies between different asset classes
- The interplay between exchange-traded and Over-The-Counter (OTC) markets
Short-Term Money Market
- Certificates of deposit
- Treasury bills
- Commercial paper
- Trade paper and bank acceptances
- Standard market norms and practices
- Key market participants
Types of Stock Exchange Participants
- Individual and institutional investors
- Fund managers
- Hedge funds
- Exchange members
- Investment banks, stockbrokers, hedge funds, and prime brokers
- Market dynamics: the relationship between buy and sell sides
The Function of the Stock Exchange
- Trading venues for various products
- The significance of the OTC market
- Historical development of stock exchanges
- Major exchanges in the modern global landscape
- Differing architectures of US, European, and Asian markets
- Asset classes traded across global exchanges
- Distinguishing primary and secondary markets
- Key hubs: New York, Euronext, London, Shanghai, and Hong Kong
- The appeal of listed companies to investors
- Leveraging exchanges to consolidate liquidity and raise capital
- Strategies for capital raising
- Corporate 'floats': various methods and approaches
Clearing and Settlement
- Settlement mechanics and associated risks
- Settlement conventions in major markets
- Settlement of equities, bonds, and derivatives
- Processes for clearing derivatives
- The Central Counterparty (CCP) role
- CCP services offered to stock exchanges
- Margin requirements
- The security trade settlement workflow
- Pre-settlement procedures
- Final settlement
- Common issues: unmatched trades, settlement delays, and failed deliveries
- Enforcement of settlement discipline on exchanges
- The trade lifecycle: linking execution to settlement
- The role of International Central Securities Depositories (ICSDs) and Central Securities Depositories (CSDs), including LCH.Clearnet, Euroclear, Crest, Clearstream International, and the DTC
Custody Services
- The role of custodians in stock markets
- Safekeeping and settlement
- Income collection and processing corporate actions
- Cash management and funding transactions
- Supplementary services
- Accounting functions
- Stock lending and collateral management
- Trustee services
- Valuation reporting
Alternative Investments
- Defining alternative investments
- Structured products: risk and return profiles
- Hedge funds: risk management and controls
- Venture capital: valuation, risk, and control mechanisms
- Private equity and angel financing
- Application of derivatives in asset management
- OTC versus Exchange-Traded Derivatives (ETD)
- Types of derivatives used in asset management
- Futures
- Options
- Risk controls for derivatives, including documentation, valuation, and reporting
Management of Quoted Equity Investments
- Risks involved in acquiring securities
- Risks involved in managing securities
- Risks associated with corporate actions
- Pricing mechanisms for quoted equities
- Primary risk sources
- General control frameworks for equity investments
- Risks specific to international equity markets
Management of Quoted Fixed Income Investments
- Risks in acquiring and disposing of fixed income securities
- Use of credit ratings and associated risk considerations
- Risks in pricing fixed income securities
- Risk and control measures in corporate fixed income processing
- Risks associated with government securities
- Sovereign risk ratings
- Valuation of government securities
- Risk and control measures in sovereign bond processing
Market and Credit Risks in Global Investing
- Identification of market risks
- Value at Risk (VAR) calculations
- Modeling market risks
- Identification of credit risks
- Measuring credit risk exposure
- Global market risk dynamics
- Money market risks
- OTC market risks
- Exchange-based risks
Testimonials (1)
The lecturer is very knowledgeable and can substantiate theories with his own personal experiences.