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Derivatives Market

COURSE DESCRIPTION

This program will give the participant thorough understanding of the derivatives market for both over the counter and exchange-traded instruments. It focuses on how to use equity derivatives and other commonly used derivatives in the market. Characteristics of the derivatives products are explained comprehensively.

CERTIFICATION AWARDED

On successful completion of the program, you would be awarded the professional certification in “DERIVATIVES MARKET” by Moody’s Analytics and EduEdgePro.

COURSE COLLATERALS AND HIGHLIGHTS

  • Detailed Credit Analysis Frameworks for corporate and financial risk and risk analysis from lenders perspective
  • In depth coverage of equity derivatives
  • Comprehensive coverage on trading and settlement in derivatives market
  • PExhaustive reading material covering detailed 4 sections outlined below

COURSE OBJECTIVES

  • Understand need of derivatives market and trading and settlement in derivatives market
  • Knowledge of key financial building blocks, used in constructing complex derivative instruments (e.g. futures, forwards, options and swaps)
  • Participant is able to understand Pay off and P & L of derivative instruments
  • Understand strategies involved in trading derivative instruments
  • Learn use and benefits of derivatives in a portfolio context

WHO SHOULD ATTEND

This course is aimed at those who wish to explore the more advanced aspects of Debt and Money Market to build a career in the below areas:
  • Hedgers
  • Derivatives sales and trading personnel
  • Risk control, risk management and audit personnel
  • Corporate account officers
  • Asset managers
  • Corporate treasury

Fast Facts

  • Certified by : Moody’s Analytics and EduEdgePro
  • Broad Coverage:
  • Overview of Derivatives
  • Characteristics of Derivatives
  • Trading and dealing in derivatives Market
  • Trade execution & clearing environment
  • Mechanics of Futures Market
  • Mechanics of Forward Market
  • Mechanics of Options Market
  • Currency Derivatives
  • Credit Derivatives

  • DETAILED CURRICULUM

    This section covers the overview of derivatives market. It explains over the counter and exchange market for derivatives, need for derivatives market and advantages of derivative instruments. Trading, dealing and settlement of derivatives is also taught. The participant will be able to understand how derivatives market functions.

    Introduction to derivatives

    Overview of Derivatives
    • Basics of Derivatives
    • Common derivative products
    • The equity CFD market
    Characteristics of Derivatives
    • Attributes of derivatives
    • Practical uses of derivatives
    • Advantages of derivative instruments over cash instruments

    The trading, dealing and clearing environment

    Trading and dealing
    • OTC vs. Exchange traded products
    • Broking vs. Market making
    Trade execution & clearing environment
    • Order vs. Quote driven markets
    • Market order types>
    • Placing orders in an electronic trading platform
    • Margining system for exchange traded instruments
    • Clearing house guarantee

    The objective of this section is to explain bond pricing. Concepts of macaulay and modified duration and convexity are introduced in this section. Yield curve is also explained in. The participant will learn how credit rating agencies work and how credit ratings are provided.

    Mechanics of Futures Market
    • Characteristics of a futures contract-Underlying asset, contract price and size, delivery and limits
    • Convergence of futures and spot prices
    • margin requirements
    • Collateralization in the over-the-counter market
    • Delivery System
    • Pay Off and P&L of futures contract
    • Short and long hedges and their uses
    Mechanics of Forward Market
    • Characteristics of a forward contract, including the asset, the contract price and size, delivery, and limits.
    • Pay off and P&L of forward contract
    • Short and long hedges and their uses
    • Difference between forward and futures contracts

    This section covers the option derivatives market comprehensively. Features of options are explained in this section. Put and call options are covered along with common trading strategies using call and put options. Option trading strategy framework is also explained that can be used when using a combination of options. Trading and settlement mechanism is explained as well.

    Mechanics of Options Market
    • Options Markets and Conventions
    • Exchange-traded stock option contracts
    • Trading, commissions, margin requirements
    • Properties of Stock Options
    • Call option
    • Put option
    • Pay off and P&L of call and put options
    • European and American option
    • Factors impacting options price
    • Option Arbitrage and Put-Call parity
    • Options Strategies Framework
    • Basic Trading Strategies Involving Options
    • Covered Calls and Protective Puts

    This section covers the other common derivatives used. It explains structure common currency derivatives used for hedging. Structures of Interest rate swaps, Forward rate agreements are also covered. Basics of Credit derivatives like credit default swap, total return swap are also taught in this section.

    Currency Derivatives
    • Cross currency swap
    • Cash flows & Settlement
    Credit Derivatives
    • Credit default swaps
    • Total return swaps
    • Credit spread products
    • Settlement
    Interest Rate Derivatives
    • Interest Rate Swaps
    • Forward Rate Agreements
    • Products cash-flows and settlement

    DETAILED CASE STUDY AND EXCEL IMPLEMENTATION

    Let us bring our classes to you! Our in-house training are ideal for groups of 10 or more people. We can provide Off-the-shelf training in the form of our classic courses, or we can provide bespoke training, tailored to your organisational goals and objectives. Please contact us for further details.