Comprehensive course analysis
- What do past participants have to say about the course?
- How many participants were promoted within three years after graduation?
- How did this course affect participants' professional trajectories?
- How many participants got their salary increased within two years after completing the program?
- What do past participants have to say about the course?
Who should attend
This programme has been designed to target participants with a familiarity with one, or some, area(s) of financial markets but who realises that there is a lot about financial markets that they don’t know. There is sufficient scope within the course to tailor it towards the appropriate level for each participant through the supporting materials, discussions and trainer input.
About the course
This course will enable participant to confidently engage in conversations with colleagues and clients of any level on any of the key current issues driving financial markets. They will be able to understand the practical implications of those issues on their own institutions.
Participants will be able to understand the effect of current events on markets across all the major asset classes including Equity, Fixed Income, Credit, Foreign Exchange (FX) and Commodities.
Participants will gain a robust understanding of how derivatives are used to manage risk in these markets in reality.
The following case studies will be employed:
- USA v China Trade War: who are the winners and losers!
- Participants consider the “Impact of Crisis” (Corona Virus) on the running of a Bank
- A bank advises its clients on how to manage currency risk in a time of heightened volatility?
- Building a Portfolio to manage risk in times of crisis
- Pricing and risk in Bonds
- Investigating and considering the value of corporate bonds from around the world
- Commodity Hedging mistakes: Silly mistakes cost $ Billions!
- Impact on Companies of volatility in commodity markets
- The “New Normal”. What shape will the recovery take, “V”, “U” or “L”?
- Live “Trading Simulation” : putting what you’ve learnt into practice.
WEEK ONE - TRANSITION FROM POST-CRISIS TO NEW MARKETS
Topic 1 – Trade Wars
By the end of this topic, participants will understand the impact on Financial Markets. In particular the effect on currencies and how they themselves can be used as “weapons” in this war.
- How trade wars work;
- USA v China trade war;
- Winners and losers in trade wars.
Topic 2 – Climate Change
By the end of this topic, participants will appreciate the impact climate change is currently having and will continue to have on the markets. They will learn about specific cases that are currently affecting the world.
- Australian bush fires;
- Is climate change impacting the markets?
- The “Black Summer” and its’ impact on the Australian Dollar.
Topic 3 – Macro Data
By the end of this topic, participants will be able to interpret Economic Data and be able to assess its impact upon markets.
- GDP pre and post crisis;
- CPI and why inflation matters;
- Unemployment: How high can it go?
- Impact on different market participants.
Topic 4 – Corona Virus Case Study
By the end of this topic, participants will be able to understand how the Markets interpret the impact of the Corona Virus is having on individual economies and the world as a whole. Participants will gain an appreciation of what actions companies are taking in response to the crisis.
- Impact on corporate earnings;
- Impact on redundancies;
- Impact on share prices;
- Impact on banking departments;
- Impact on FX and interest rates;
- Governments’ responses to minimise impact on our economic systems;
- Where are we now?
- Organisational risks and solutions for the future.
WEEK TWO - EXPLORING THE SOURCES OF FX VOLATILITY
Topic 1 – FX Spot Markets: Basics
By the end of this topic, participants will have a good knowledge of how and where FX markets trade, how they operate and their size and importance in the Financial World.
- Trading Hubs
Topic 2 – Key Currencies
By the end of this topic, participants will learn how investors and traders view the FX markets and how and why they make their decisions on which currencies to buy and sell.
- King Dollar
- The ultimate Risk-off Currency
- Why the USD is always the safe-haven currency
- What is Risk-on and Risk Off
- Euro and Yen
- Why they move
- Pound collapse and recovery
- From Risk Off Currency to Risk On
- Why the wild swings, what does it mean?
- Emerging market currency pressure
- What has happened to Emerging Market currencies?
- Emerging market currency drivers during the crisis
- Currency risk solutions for clients given current volatility
Topic 3 – FX Forwards and Options
By the end of this topic, participants will have a good knowledge of how FX Forwards and Options are priced and how they are used for speculation and hedging in the “real world”.
- Basic structure and terms
- Understanding the uses of FX Forwards and Options
- Speculating and Hedging with FX Derivatives
- Understanding Volatility…the “Greeks”
Topic 4 – Managing FX Risk for Corporates
By the end of this topic, participants will have learnt how regulations have forced derivatives to be sold as “risk solutions”. They will understand why Corporates use them to hedge risk and how Banks make money out of these products.
- Identifying Corporate FX Risk
- Selling Derivative Solutions: Best Practice
- Derivative Regulation
- A look at the Major FX Derivative Solutions used by Corporates
- How Banks make money from Derivatives
WEEK THREE - US STOCK MARKET VOLATILITY EXPLORED
Topic 1 – US stock market volatility explored
By the end of this topic, participants will understand how volatility is traded and how a crisis is viewed by market professionals, from Bank Traders, to Asset Managers and even the Retail Market.
- The VIX - What is it and how does it help us measure volatility?
- Stock winners from the covid-19 crisis
- What does history tell us about a crisis?
- Portfolio performance during the covid-19 crisis
Topic 2 – Case Study: Portfolio Construction
By the end of this topic, participants will have detailed understanding of how asset managers advise and manage institutional client money, focusing in on portfolio construction techniques for the current market:
- A client of an asset management firm is 60% invested in equity, 30% in bonds and 10% in cash. We look at how their portfolio performance would have been over the last few months
- The client is asking for advice: Given current market conditions, how should their investments be allocated going forward?
Topic 3 – Equity Performance
By the end of the topic delegates will have a good understanding of how Equity Markets have been impacted by the crisis and they will appreciate the risks going forward.
- Deeper look at which Equity Sectors and the winners and losers so far during the pandemic…
- What does the future of the Equity Market look like?
- Bull or Bear Markets Ahead?
WEEK FOUR - FIXED INCOME MARKETS
Topic 1 – Government bond and money markets
By the end of this topic, participants will understand how interest rate markets operates. From the building blocks of the yield curve, to how these markets are traded and what drives them.
- Building the yield curve;
- Bond pricing and why it matters;
- Yield curve comparisons – historical analysis;
- Interest rate environment around the world and what will happen next;
- Government Bond markets
- US Treasury market
- Germany v other European Yields
- Italian Default?
- Bloated Government Balance Sheets
- The size of the debt
- QE and government loans
- What does this mean?
Topic 2 – Credit markets: Corporate bonds
By the end of this topic, participants will have an in-depth understanding of how the Credit Markets operate. They will understand how Corporate Debt is priced and traded. They will learn how the Credit Derivatives markets operate and the impact of Government intervention.
- Corporate Bond markets explained;
- Corporates, their credit ratings and how that influences their funding costs;
- Corporate bond risk/return analysis and portfolio construction;
- Credit spreads across credit grades e.g. AAA, AA etc;
- Focus on spread from Investment Grade (IG) to High Yield / Junk;
- Credit Indicators
- Credit Derivatives
- The X-Over Index
- Government’s promise to buy junk;
- The Fed and other central banks strategies to keep sub IG companies afloat
- Feeding Frenzy: Sub IG new issues
- Why junk bonds are so popular
- What will impact credit spreads going forward
WEEK FIVE - OIL PRICE COLLAPSE, COMMODITY VOLATILITY AND THE ‘NEW NORMAL’
Topic 1 – Derivatives basics
By the end of this topic, participants will have a good knowledge of how futures markets operate and how they are used by corporates all over the world to hedge their risk. Not always successfully!
- Structure of Futures markets
- Focus on commodity derivatives
- How corporates use commodity derivatives to hedge risk
Topic 2 – Focus on Oil Markets
By the end of this topic, participants will have a thorough understanding of what drives the oil price and how crises including the current pandemic have a major impact. They will also understand the inner workings of these markets and how investors can end up paying to sell their oil.
- Drivers of Oil prices;
- OPEC, USA, and the pandemic;
- The crack spread;
- Case study: Oil Futures Trade Negative;
- “Paying to sell your oil”: Why Oil futures’ prices turned negative
- The role and impact of ETFs
- Case Study: Hedging mistakes of the past
Topic 3 – Focus on Gold
By the end of this topic, participants will know why Gold is seen as the ultimate safe haven! They will also appreciate there are other impacts on the price and consider what is next for the Gold price?
- History of the gold price;
- Impact of the pandemic on the gold market;
Topic 4 – Precious metals and soft commodities markets
By the end of this topic, participants will gain an understanding how and why commodity prices move and learn how corporates around the world manage this volatility.
- Silver, Palladium etc;
- Softs, Grains etc;
- Case study: Commodity market fluctuations – Impacts on profitability and future supply and demand;
- Case study: Commodity market fluctuations – Client solutions for hedging commodity, FX and interest rate risks with derivatives.
Topic 5 – What the ‘New Normal’ might look like?
Bringing it all together. By the end of this topic, participants will explore what the ‘New Normal’ might look like and how that will affect each participant’s institution. The discussion will cover different perspectives on key topics including:
- Short Term Deflation
- Long Term Inflation
- “U shape” or “L shape” Recovery?
- Impact on Supply Chains
- What we have learnt from previous pandemics and crisis
Course participants have the opportunity to put what they have learnt into practice. They will be able to trade FX and commodities. By actually experiencing the ebb and flow of trading, delegates gain a real understanding of how markets work, and the risks and therefore controls that need to be in place for them operate safely and efficiently.
Mark worked in Investment Banks including HSBC and Bank of Montreal for nearly 20 years. During this time he worked in Global Custody and then as a trader, running books in FX, bonds and derivatives. Mark has run courses all over the world including Amsterdam, Dublin, London, New York, Hong Kong,...
Videos and materials
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