Clearing, Settlement and Counterparty Risk
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Counterparty Risk Management – Clearing & Settlement for Securities and Derivatives. Explore the Role of Central Counter Party (CCP), relationship with market players and how to do margining to reduce risk.
We offer a unique opportunity to complete this programme remotely via virtual classroom which will be delivered as a full day session (9 a.m. until 4 p.m) on 17 Oct 2022.
The course is delivered by a senior City expert with over 30 years of experience.
On completion you will receive a comprehensive set of course materials and course certificate.
The Course Leader has been working in the derivatives industry for 30 years and regularly teaches on behalf of the world’s leading clearing houses and stock exchanges. 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. You will learn about the role of Central Counter Party (CCP) otherwise known as the Clearing House, and its role to mitigate counterparty risk, as well as relationships between end users, clearing members and the CCP. You will also learn how the risk is mitigated through the process of margining.
The course also shows in some detail, how the margining system allows for the netting of risk and the effective management of collateral.
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
You may be also interested in one of the following programmes:
Register for any 2 public courses at the same time and save £100 + VAT (in total, not per course)
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
- Counterparty Risk Management
- Back and Middle Office Operations
- Fund Administrators
- Compliance and Risk Management
Clearing and Settlement for Derivatives and Securities - A 1 Day Course
Understanding counterparty risk particularly in the post financial crisis environment
- Bi-lateral trade with and without collateral agreements
- Using the services of a third party to reduce risk
- Standardising the contract and netting clauses
- 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
- 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
- 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
Paul has over 30 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.
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All our trainers have been working for many years in their respective sectors before they begun to teach so they bring a wealth of practical experience to the classroom.
Most of them used to work for 15 or more years in the financial sector and corporate world, and were holding positions of Directors, VP and Senior Managers. Some of them have published books and have written articles for specialised magazines and newspapers including FT, The Independent, The Times etc. You can find detailed biography of each trainer on the page of the course you want to register for.
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17 Oct 2022, Online / Virtual
Register by 30 Sep to save £120
Early bird price £875 + VAT
Regular price £995 + VAT
REGISTRATION CLOSES 7 OCT. 10% discount for 3 people. There is no VAT charge if you are based outside of the EU.
This topic can be arranged on in-house basis. If you have a group of 4 or more we can customise it and deliver in any location worldwide. Contact us to discuss your requirements