Foundations of Financial Markets

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Foundations of Financial Markets

The Foundations of Financial Markets course is a practical three-day program designed to give participants a clear idea of how the financial markets work, and the roles played by the various participants in the market.

Learning Outcomes

By attending this course, you will:

  • Explore the institutions, markets, services, and products
  • Obtain a clear overview of the international financial markets
  • Appreciate the role of various financial institutions
  • Examine a range of essential financial products
  • See how each product is used in the markets
  • Understand the role of risk management and compliance
  • Obtain practical hands-on experience

Who Should Attend

Anyone working in the financial markets.



Seminar Content

Introduction to Financial Markets

This module sets the scene by explaining how each of the major financial markets works, what products are traded, how the markets are inter-related, and the role played by each major participant.

  • The Development of the Global Markets
  • Participants in the Markets
  • Investors, borrowers, and intermediaries
  • Role of retail, investment and commercial banks
  • Institutional investors
  • Individual investors
  • Mutual and hedge funds
  • Pension funds and insurance companies
  • Regulation and control
  • The role of the regulatory authorities
  • Banking in the 21st century
The Core Businesses

Here we look at the part played by each of the key business units within a financial institution, including the vital support functions. Participants will be able to see how their role fits within the bank as a whole.

  • Corporate Finance & Investment Banking
  • Trade Finance
  • Asset Management and Private Banking
  • Corporate Banking
  • Insurance
  • Real Estate
  • Operations and Compliance
  • The Trading Function
  • The Sales Function
Introducing the Cash Markets

An important part of the financial marketplace are the markets for "cash" products – like equities, fixed-income, the money markets, and FX. This module sets-the-scene, and introduces the functioning and purpose of each product.

  • Capital Markets Overview
  • The Equities Markets
  • Research, Valuation, and Sales
  • Trading Equities
  • The Money Markets
  • Fixed Income Products
  • Treasury and corporate bonds
  • High-yield and emerging market debt
  • Repos
  • Foreign exchange
  • The products in context
  • Applications for the bank
  • Applications for clients
Market Dynamics and Trading

This section will feature hands-on practice using our unique Global Trader simulator, giving participants first-hand experience of the dynamics and practicalities of trading, and the roles played by the bank's traders, customers, and the back office.

  • Quote-driven vs. order-driven markets
  • Market-making
  • Customer dealing
  • computer Equities simulation
Equity Markets and Instruments

The equities markets are an important source of finance for new and established companies. This module explains how the equities markets work, how new issues are brought to the market, and how stocks are traded thereafter.

  • Review of international equity markets
  • Type of equity product
  • Depositary receipts
  • Issuing procedures
  • Role of the Stock Exchange
  • The increasing importance of electronic, algo, and high-frequency trading
  • Auto trades and block trades
  • Pricing and valuation techniques
  • Stock indices
  • Convertibles and warrants
  • Mergers and acquisitions
  • Trading strategies
  • computer Equities trading simulation
Introduction to the Time Value of Money

The time-value-of-money concept is central throughout banking and finance. This module explains TVM concepts, and the principles of discounting and annuities.

  • Time value of money principles
  • Present and future values
  • Interest and discount factors
  • Simple vs. compound interest
  • Discounting and compounding
  • Annuities
  • Discounted cash flows
  • Net present value
  • Internal rate of return
  • computer TVM Workshop
Understanding the Yield Curve

This module explains what the yield curve is, why it adopts a particular shape, and what are the implications for investors, borrowers, and banks.

  • Definition of the yield curve
  • The normal yield curve
  • Liquidity and expectations hypotheses
  • Up- and downward sloping yield curves
  • Yield curve strategies and plays
  • Forward rates
  • computer Analysing the present yield curve
Money Markets and Instruments

This module explains the money markets – the market for short-term debt instruments used by governments, companies, banks, and investors.

  • Discount vs. coupon securities
  • Interbank deposits
  • Bills
  • Commercial paper
  • Certificates of deposit
  • LIBOR and its successors
  • Repos
  • Pricing money market instruments
  • Discount vs. yield quotations
  • computer Comparing short-term investments
Bond Markets and Instruments

The fixed-income markets are one of the most important components of the capital markets, providing long-term finance for governments and corporations. This module explores the issuers, and the types of bond which are issued.

  • Bonds vs. equities
  • US Treasuries
  • Bunds, OATs and BTPs
  • The European sovereign debt crisis
  • JGBs, UK Gilts
  • Eurobonds
  • MTNs and Euronotes
  • Corporate bonds
  • FRNs vs. fixed income
  • The treasury yield curve
  • Primary vs. secondary market
  • Bond rating
  • High-yield bonds
Foreign Exchange

The Forex market is a global 24 hour $5 trillion-a-day market vital for commerce and trade. This module explains the role and functioning of the FX market, the participants, and the types of transactions which are traded.

  • Functions and purposes of the FX market
  • Market mechanics
  • Quotation conventions
  • Cross rates
  • Influences on the market
  • The future of the Euro
  • computer FX spot simulation
  • Outright forward and swap deals
  • Relation between spot & forward markets
  • Impact of interest rates
  • Quoting forward rates and swap points
  • computer Corporate applications for forward and swap transactions
Derivatives Overview

Over the past thirty years, derivatives have revolutionised the management of financial risk, and created huge opportunities for banks and other players in the market. This module explains the types of derivative contract, and how they are used to manage interest rate, currency, equity, and commodity risk.

  • Futures contracts
  • Interest rate futures
  • Bond and stock index futures
  • computer Using futures to hedge a bond portfolio
  • Interest rate swaps
  • Currency swaps
  • Equity swaps
  • Credit default swaps
  • Credit default indices
  • computer Swap applications
  • Option terminology
  • Stock options
  • Interest rate caps and floors
  • Exotics
  • computer Hedging risk with derivatives
The Role of Risk Management and Compliance

Managing risk is increasingly important. This module analyses the different risks to which banks are exposed, and how these risks are measured and controlled. The role of the regulatory agencies and their relationship to banks is also examined.

  • What is risk?
  • Sources of risk in the financial markets
  • Options for managing risk
  • The importance of compliance
  • Fraud
  • Money-laundering (how to prevent it)
  • The role of regulatory authorities
  • The PRA, BofE, SEC, CFTC, Fed, and BIS
  • computer Some financial disasters

When and Where
   10 Jun 2024 - 12 Jun 2024
   New York

Other Dates and Locations
Search for Foundations of Financial Markets in our course schedule for alternative dates and locations where this course is offered.

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