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Course Outline
The Global Capital Markets
- Defining the ‘financial market place’
- The historical evolution of today’s global financial markets
- The influence of financial media
- The architecture of major capital markets:
- Exchanges, Clearers, and Regulators
- The recent surge in global investment activity
- Variations in ‘Stock Exchange’ structures
- The position of Stock Exchanges in contemporary markets
- Stock Exchanges in the US, Europe, the Middle East, and Asia
Regulation of Financial Markets
- Capital Adequacy Requirements
- Basel I
- Basel II
- Basel III and its consequences
- Innovation in new product development
Asset Classes and Their Corresponding Markets
- Current instruments traded on Stock Exchanges
- Equities – Ordinary and Preferred
- Bonds – Corporate and Government
- Bonds – Fixed, Floating, and Zero Coupon; the Yield Curve
- Money Market instruments
- Currency markets
- Investor motivations: drivers for buying and selling
- Income versus Capital Gains
- Interconnections between various asset classes
- Relationships between Exchange-traded and Over-The-Counter (OTC) markets
The Short-Term Money Market
- Certificates of deposit
- Treasury Bills (T Bills)
- Commercial paper
- Trade paper and Bank Acceptances (BAs)
- Standard market norms and practices
- Types of market participants
Categories of Stock Exchange Investors
- Individual and institutional Investors
- Fund managers
- Hedge funds
- Stock Exchange members
- Investment banks, Stockbrokers, Hedge Funds, and Prime Brokers
- Intra-market dynamics – the buying and selling sides of the industry
The Function of the Stock Exchange
- Platforms for trading specific products
- The significance of the OTC market
- Historical development of Stock Exchanges
- Key Stock Exchanges in modern markets
- Architectural differences in US, European, and Asian Markets
- Asset classes traded on global Stock Exchanges
- Major Primary and Secondary markets
- New York, Euronext, London, Shanghai, and Hong Kong
- The appeal of ‘listed’ companies to investors
- Leveraging Stock Exchanges for liquidity pooling and capital raising
- Strategies for Capital Raising
- ‘Floating’ a company – various methodologies
Clearing & Settlement
- Settlement processes and settlement risk
- Diverse Settlement Conventions in major markets
- Handling Equities, Bonds, and derivatives
- Procedures for Derivatives Clearing
- The role of the Central Counterparty (CCP)
- CCP services offered to Stock Exchanges
- Margin requirements
- The security trade settlement workflow
- Pre-settlement stages
- Final Settlement
- Potential issues – unmatched trades, settlement delays, and failed deliveries
- Stock Exchange Settlement Discipline
- The ‘life cycle of a trade’ – integrating processes from execution to settlement
- The function of International Central Securities Depositories (ICSDs) and Central Securities Depositories (CSDs) – including LCH.Clearnet, Euroclear, Crest, Clearstream International, and the DTC
Custody
- The role of Custodians in Stock markets
- Settlement and safekeeping
- Income collection and Corporate Actions
- Cash management and funding transactions
- Additional custodial 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 challenges, risk, and control
- Private Equity and Angel Finance
- Application of derivatives in Asset Management
- OTC versus Exchange Traded Derivatives (ETD)
- Types of Derivatives used in Asset Management
- Futures
- Options
- Risks and controls related to derivatives, including documentation, valuation, and reporting considerations
Managing Quoted Equity Investments
- Risks involved in acquiring securities
- Risks associated with securities management
- Risks related to corporate actions
- Pricing mechanisms for quoted equity investments
- Primary sources of risk
- General controls within equity investment
- Risks specific to international equity markets
Managing Quoted Fixed Income Investments
- Risks associated with acquiring and disposing of fixed income securities
- Use of credit ratings and associated risk factors
- Risks linked to the pricing of fixed income securities
- Risk and controls within corporate fixed income processing
- Risks associated with Government Securities
- Sovereign risk ratings
- Valuation of government securities
- Risk and controls within sovereign bond processing
Market and Credit Risks of Investing in the Global Market
- Market risks
- Value at Risk (VaR) calculations
- Market risk modelling
- Credit risks
- Measuring Credit risks
- Global Market Risks
- Money Market Risks
- OTC Risks
- Exchange risks
14 Hours
Testimonials (1)
The lecturer is very knowledgeable and can substantiate theories with his own personal experiences.
