Understanding Money Markets and FX
London & Dubai- Contact us to find our about future dates for this course
Description
This course is designed to provide delegates with a clear and simple explanation of the most common calculation techniques used in the financial markets and how they are applied in particular to swaps, repos, futures and options.
The course will start with defining the money market and its different instruments as well as main issuers and their motivation. Delegates will explore the concept of value of money versus future cash flow predictions to move towards different techniques for pricing interest rate instruments. Finally the repo market and types of instrument will be explained.
This is a very practical course for anyone who wants to learn about the mechanisms and instrument of the money markets today.
Main Topics Covered During This Training
- Money market instruments including T-Bills, CD's, CP, BA's, short dated bonds and others
- Main issuers and their motivation
- The concept of value of money vs future cash flow
- Explore the different types of interest and day count conventions
- Techniques for calculating interest rate instruments
- Study the use of discount factors and functions
- Strategies for pricing money market instruments
- Applying PV and FV techniques for pricing swaps and bonds as well as boot strapping techniques
- Defining the repo market and different types of repos
- Pricing strategies for repos
- Bilateral and tri-party agreement
What Will You Learn By The End Of This Training
By the end of this course delegates will have a sound understanding of different types of money market instruments and learn about various techniques for calculating interest rate instruments.
Participants will be able to apply the calculations to swaps, repos, futures and options markets. Different types of repos that can be traded will be discussed as well as how they are priced and settled on a bilateral or tri-party basis.
Who Should Attend
From Investment Banks, Asset and Fund Management, Private Banks and Institutional Investors: Managers and Team Members from:
- Treasury Departments
- Money Market
- Repos
- Fund Managers
- Portfolio Managers
- Financial Advisors
- Government Agencies
- Pension Funds
Teaching Method
This is a very interactive course with many exercises, classroom discussions and case studies.
You will benefit from comprehensive take away course documentation.
In order to help us establish your individual and business concerns, you will be asked to fill pre-course questionnaire.
Because of the nature of the course the number of places is limited and will be filled on first come, first accepted basis. We advise to book in advance in order to avoid disappointment.
MONEY MARKET INSTRUMENTS
This section explains the relationship between the value of money today and the value of money (cash flows) in the future.
Money Markets Instruments
- Types of instruments: T-Bills; CD’s; CP; BA’s
- Discount versus interest bearing securities
- Short-dated bonds
- Who issues and why?
- Establishing a CP programme
- Fixed income derivatives: the bond futures contract
- Calculating the net present value of a series of cash flows
- Discount factors and discount functions
Calculating interest
- Simple versus compound interest
- Nominal versus effective rates
- Day count conventions
- Annuities
- Interpolation and extrapolation of rates
Working out a spot FX rate
- How a cross rate is determined
- Calculating a forward FX rate
PRICING MONEY MARKET INSTRUMENTS
This section reviews the different interest rate instruments and how they are priced and valued using the simple techniques described earlier on.
- Cash deposits, T-bills, bills of exchange, CD’s, CP
- FRA’s, STIR futures
- Bonds
- Swaps
- Applying PV and FV techniques to calculate swaps, bonds and STIR Futures
- Using discount factors and discount functions
- Boot strapping techniques for working out NPV
THE REPO MARKET
This section provides an explanation of the different types of repos that can be traded, and how they are priced and settled on a bilateral or tri-party basis.
- Market development and history - GMRA
- Definition of repo types and legal agreement
- Classic repo/sell buy back/collateral lending
- Cross currency repos
- Comparison of repo types
- Quoting a repo price
- Hold in custody
- General collateral v special
- Haircuts and types of margin settlement
- Bilateral and tri-party settlement
- Clearing House margining arrangements
Paul North
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.
London & Dubai - tba
Contact us to ask about the next edition of this course.
______________________________________________________________
DISCOUNTS
- 2 people - 5% discount, 3 people - 10%. Delegates have to be from the same company and book at the same time.
- If you book for 2 courses at the same time you will receive 10% of the full value of the second course.
IN-HOUSE TRAINING
If you have a team of 4 or more this course can be customised and organised in-house at your convenience in any of your offices worldwide. Contact one of our advisors to find out more.
Call us now on +44 (0) 207 193 5035
