- Intermediate/Introductory *6 hours CPD
A one-day introductory course for those requiring a basic working knowledge of Capital Markets. The development of bond markets is examined, from early government fund raising through to the sophisticated products in use today. We look at the range of products along with the roles and motivations of issuers, investors and intermediaries. The course covers:
Market background – Capital Market inter-relationships
- Different funding/investing mechanisms:
- Cash/Money/Debt markets
- Bonds
- Equities
- FX
- Derivatives
- The importance of LIBOR as a reference rate
Background and development of the Bond Markets – Primary vs. Secondary Market; Types of Bond Markets – Government/Corporate, Domestic/ International, Eurobonds; Globalisation, Disintermediation and Securitisation
Instrument Characteristics – General features – Coupons: Fixed/Floating/Zero; Secured/Unsecured secretaries; Bearer/Registered; Bonds/Notes/Bills; The role of the issuer, investor and intermediary
Bond Dynamics – Bond market mechanics: Interest yields, Redemption Yields, Accrued Interest; Clean and dirty prices; Price: Yield relationship; Credit risk and the rating agencies; High yield securities/junk bonds
Yield Curves – The term Structure of Interest Rates, Models of the Yield Curve: Positive/Negative/Flat/Inverse/Segmented; Rationale for shapes; The Sterling yield curve; Examples and applications for issuers and investors
Securitisation – Asset Backed Securities (ABS); Transaction Types: Mortgages, Future Receivables, Municipal income streams, Tax Revenues; Structured Products: CDO’s, CMO’s; Conventional and Synthetic Structures