What past delegates say?

 "Fantastic, relevant case studies and engaging delivery! Great instructior. I've leanrt a lot thanks to Paul's fantastic teaching style."

Settlement Professional, Orbis Investments

"Very positive. Felt like I've gained a lot of insight in the subjet matter."

Settlement Specialist, UK Debt Management Office

"Paul was very enthusiastic and knolegeable. I really enjoyed it."

Settlement Specialist, Orbis Investments

Clearing and Settlement for Derivatives and Securities

Register Now

21 May 2019 London

Special Christmas Offer until 20 Dec £750 + VAT. Regular price £950 + VAT. 10% discount for 3 people.

Course Description

The Course Leader has been working in the derivatives industry for 28 years and regularly teaches on behalf of the world’s leading clearing houses and exchange. These institutions are vital to managing counterparty risk. 

In recent years a lot of attention has been focused on the subject of post trade environment - clearing and settlement.
 
This informative and easy to follow one day course, has been specially designed to explain how the clearing and settlement process works for derivatives and securities, demonstrating how banks and their clients manage their counterparty risk - which is particularly important in the post financial era.
 
The course also shows in some detail, how the margining system allows for the netting of risk and the effective management of collateral.
 
You may be interested in one of the following programmes: 
 
Register for 2 courses at the same time and save additional £100 +VAT (in total, not per course). 

 

What Will You Learn

By the end of this course you will be able to: 

  • Understand the significance of counterparty risk – especially post financial crisis 
  • Explain the role and function of the central clearing counterparty (CCP)
  • Illustrate the relationship between clearing members and clients and show how different types of client accounts can be set up and managed
  • Demonstrate how CCPs and central security depositories (CSDs) interact
  • Show how CCPs are structured and explain their “lines of defence”
  • Describe how listed derivatives v OTC derivatives are collateralised and cleared
  • Show how the margining system works for futures and options and other derivatives like swaps compared with bonds and equities
  • Illustrate the benefit of portfolio based margining systems like SPAN and VaR margining methodology
 

Main Topics Covered During This Training

  • Counterparty risk in the post financial crisis environment
  • Central clearing counterparties (CCPs) and clearing members
  • Margining for futures (linear products) and options (non-linear), other derivatives and securities
  • Central security depositories (CSD)

 

 

Who Should Attend

 Professionals from or involved with: 

  • Clearing houses
  • Prime Brokers and Derivative Clearing Brokers
  • Clearing and Settlement
  • Custodians
  • Counterparty Risk Management 
  • Back and Middle Office Operations
  • Fund Administrators
  • Compliance and Risk Management
  • Audit
  • IT
Register Now

21 May 2019 London

Special Christmas Offer until 20 Dec £750 + VAT. Regular price £950 + VAT. 10% discount for 3 people.

Clearing and Settlement for Derivatives and Securities - A 1 Day Course

9.15 a.m. Course Starts 

Understanding counterparty risk particularly in the post financial crisis environment

 
This section describes the aspects of counterparty risk in a bi-lateral trade and shows how in the OTC market, collateralising the deal can reduce this risk. This section also looks at the capital constraints on a bank post financial crisis and how netting and central clearing can be of benefit. 
 
  • Bi-lateral trade with and without collateral agreements
  • Using the services of a third party to reduce risk
  • Standardising the contract and netting clauses
 
Central clearing counterparties (CCPs) and clearing members
 
In this section we describe how CCPs can remove credit risk in a trade through the process of “novation or open offer” and demonstrate the benefits of netting for clearing members and clients.
 
  • What is the role and function of the CCPs?  Who owns the CCP?
  • How does the clearing house ensure contract performance?
  • What is the difference between a trading participant and a clearing member?
  • Different types of client accounts and levels of protection and portability
  • Margining systems – SPAN v VaR margining methodology
  • Benefits of cross margining and netting
  • What are the CCPs’ “lines of defence” other than margining?
  • Risk management committee
 
 
Margining for futures (linear products) and options (non-linear), other derivatives and securities
 
This section offers numerical examples of how margining for futures and options (and other securities) works, using traditional methods like SPAN and the now popular VaR margining methodology.
 
  • Calculating initial margin and variation margin
  • What is spread margin and other types of margin?
  • How does VaR margining differ from traditional margining systems like SPAN?
  • How does margining work for securities like equities and bonds?
  • Illustration of cross margining benefits
  • Types of acceptable collateral 
 
Central security depositories (CSD)
 
This section concludes with an explanation of how CSDs cooperate with clearing members, clients and the clearing house in order to safely settle contracts.
 
  • Types of settlement accounts
  • Gross settlement versus netting on settlement day for securities
  • Settlement of physically settled derivatives
  • Working out the invoice amount
  • Managing corporate actions
  • Transferring securities for cash and interaction with the CCP

 

Questions & Answers

5 p.m. Course Finish

Paul has over 20 years experience of working and teaching in the financial and derivatives industry.  Paul joined the London International Financial Futures and Options Exchange (LIFFE) in 1988, spending several years on the exchange trading floor before transferring to LIFFE’s Business Development Department.

During his time at LIFFE, Paul worked in the fields of broker relations, product research and development, marketing, market automation and education. Paul was Head of Education at LIFFE, before leaving in Dec 1998 to pursue a freelance career in financial education and consultancy.

Paul is also a qualified teacher and has extensive speaking experience both in the UK and abroad, covering all the major aspects of financial markets.  Paul has taught delegates from virtually all of the worlds leading investment banks, funds and trading houses. The list of clients includes JP Morgan, Goldman Sachs, Deutsche Bank, Barclays Capital, Morgan Stanley and Merrill Lynch among others.

Clearing and Settlement for Derivatives and Securities <p>The Course Leader has been working in the derivatives industry for 28 years and regularly teaches on behalf of the world&rsquo;s leading clearing houses and exchange. These institutions are vital to managing counterparty risk.&nbsp;</p> <div>In recent years a lot of attention has been focused on the subject of post trade environment - clearing and settlement.</div> <div>&nbsp;</div> <div>This i ... 1558396800 London