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Risk Management
Total risk management is the combination of all the elements of risk management into a consistent strategy...
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Training - Investment Banking
Introduction to Iinvestment Banking:
Duration of Course: one week programme
The Importance Of Capital Markets
This course is specifically designed for delegates who want go
obtain a sound grasp of how the financial markets work, how
banks are financed, their competitive edge and the services
they provide to corporate clients. In particular, the various
capital market instruments are covered. Delegates will also be
able to understand why such financial instruments are
necessary and their contribution towards risk reduction,
Through financial engineering, delegates will see how the
capital market practitioners use derivatives to tailor the
needs of banking clients to suit the requirements of
corporates who issue shares and bonds.
Objectives of Capital Markets Course
This course is introductory and is designed for professionals
in investment banking. It is also suitable for experienced
banking professionals who wish to get a broader understanding
of the financial markets sector. The course introduces the
delegates to the various products on the market and how they
help banks corporates to achieve their objectives. Emphasis is
placed on the valuation, risk management, regulatory and
accounting perspective. Proprietary trading, investment trusts,
unit trusts and hedge funds are also covered. Emphasis is
placed on practical case studies.
- Identify the major sources of risk facing a bank
- Be able to distinguish between Operational, Credit and
Market risk
- Be able to establish effective controls to minimise risk
- Be familiar with ways to measure a bank’s exposure to
Operational Risk
Products Covered
- Bond markets, including Eurobond and convertible bonds
- Equities markets, including valuation techniques
- The money markets and foreign exchange markets
- Swaps and their applications
- Futures and forwards, including interest rate futures and
FRAs
- Options markets, including options pricing theory and
practical applications
Who Should Attend
This is an introductory course and will therefore suit those
who are working in investment banking. The course will appeal
in particular to accountants and control staff from the middle
and back office. The course will also be suitable for
Information Technology and support staff including human
resources.
Course Overview
A. The Financial Markets
1. Financial Institutions
- Defining investment banks and how they operate
- Investment banking, stockbroking and fund managers
- Financial advisory services
2. Impact of the Economy on the Financial Markets
- The national economy and economic indicators
- The financial economy and its impact on the markets
- Recent developments in the financial markets
- The current political climate and its effect on
international capital markets
3. Types of Markets
- Cash and derivatives evaluation for Fixed Income/FX/Money
and Equity markets
- Risk and return in the markets
- Hybrid securities:
* deposit preferred stock
* deposit convertible bonds
* deposit FRN’s
* Role of capital adequacy in the markets
4.Debt and Equity Underwriting
The firm's broad-ranging debt capabilities include:
- syndicated lending
- restructuring finance
- money market instruments, including commercial paper
- high-grade securities
- high-yield securities
- securitized finance, including asset-backed and
mortgage-backed securities
- structured finance, including collateralized loan
obligations, collateralized debt obligations, and credit
derivatives
- emerging markets origination - sovereign and corporate bonds;
local and global issues
- project finance
- private placement
On the equity underwriting side, some of these capabilities
include:
- initial public offerings
- follow-on common stock issues
- convertible issues
- private placements
5. Market Making, Trade and Invest
Investment bank's broad range of investment products and
financial instruments include:
- money market instruments such as commercial paper,
certificates of deposits, loan participations and bankers'
acceptances
- corporate securities: domestic and cross-border, high-grade
and high-yield
- government and quasi-government securities, agency
securities and municipal bonds
- emerging markets investments: sovereign and corporate bonds;
local and global issues
- structured finance obligations and securitized obligations
- equities
- commodities such as base metals, bullion, energy products,
softs and agricultural products
- foreign exchange and derivatives
- exchange- traded future and options
- structured investment
Workshop: Delegates will be given a series of questions
relating to debt and equity underwriting.
Fixed Income Markets
1.Characteristics of fixed income investment
- Historical context of fixed income versus other markets
- Advantages and disadvantages of investing in fixed income
- Fixed income product overview and investment variables
- Risks associated with investment in fixed income
2.Eurobond markets
- Government bond markets
- Eurobond markets
- Origination, syndication and pricing of new issues
- Ratings
Case Study: Calculation of various yield measures of a bond
with multiple call options. Semi-annual and annual yield
calculations
3. Interest Rate Risk
- Historical volatility measures
- Duration and convexity
- Other volatility measures
- Current developments in measuring and controlling fixed
income risk
4. Yield Curve and Term Structure
- Theories of term structure
- Strips and the spot (zero) curve
- Yield curve generation using bootstrapping
- Forward rates
C. Credit Market and Credit Derivatives
The credit markets
- Evaluation of corporate credit risk
- Financial ratio analysis
- The role of rating agencies
- Analysis of the high yield bond market and credit
derivatives
D. Overview Financial Instruments
Swaps - the instruments and applications
- Interest rate and currency swap definitions
- Key players
- Pricing and trading swaps
- Asset and liability swaps
Case Study: Evaluation of both a synthetic FRN and swapped new
Eurobond issue
2. Forwards and futures
- Contract definition and design
- The role of margin
- The role of futures in the markets
- Hedging, speculating and arbitraging with futures
Case Study: Calculation of margin and hedging ratios
3. The equity markets
- Major equity markets
- Emerging markets
- Classification of equities
- Financial ratio analysis
- Equity valuation:
- fundamental analysis
- quantitative analysis
- technical analysis
- Capital Asset Pricing Model (CAPM)
4. Equity portfolio management
- Modern Portfolio Theory
- Active versus Passive investment strategies
- Asset allocation
- Performance measurement
E. The Derivatives Markets: Part Two
Understanding the options market
- Option definition and features
- Payoff profiles
- Option pricing factors
- Put call parity
Case Study: Arbitrage pricing
2. Trading the options markets
- Volatility measures
- The Greeks
- Options trading strategies
- Managing and controlling risk in options
Case Study: Delta hedging strategies and Risk/reward pay-off
construction
3. Approaches to managing risk
- Identifying risk
- Measuring risk
- Managing market and credit risk
- Introduction to Value-at-Risk
4. The Regulatory Environment
Course Fees
VAT to be included at the local rate, if applicable. Costs
shown are per delegate inclusive of refreshments, lunches and
seminar materials. Cost of accommodation is not included.
GBP 4250
Certificates of Participation
Certificates of participation are remitted to course
participants upon request. |
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