Capital Markets Training Course

Participants can assess the responsibilities and dependencies of key market participants and infrastructure providers.

• Broker-dealers connect clients, liquidity providers, venues, and clearing services
• Exchanges, multilateral facilities, and systematic internalisers compared by trading model
• Central counterparties manage novation, margin collection, and default management
• Central securities depositories support settlement finality and securities safekeeping
• Custodians, fund administrators, and transfer agents assigned operational responsibilities
• Trade repositories collect derivative reports for supervisory monitoring purposes

Participants can interpret market data and explain the factors that influence observable prices.

• Bid, offer, mid-price, spread, and depth interpreted from market quotations
• Order-book information assessed for available liquidity and execution risk
• Trade reporting data distinguished from actionable executable price information
• Benchmark rates examined for governance, methodology, and fallback provisions
• Yield curves constructed from quoted instruments and interpolation assumptions
• Price discovery linked to information, inventory, volatility, and dealer capacity

Participants can evaluate equity instruments, issuance methods and equity-market trading considerations.

• Ordinary shares, preference shares, and depositary receipts compared by investor rights
• Initial public offerings evaluated through bookbuilding, allocation, and stabilisation processes
• Rights issues and placements assessed for dilution and shareholder treatment
• Market capitalisation, free float, and index inclusion interpreted correctly
• Corporate actions traced from announcement through entitlement and payment dates
• Equity liquidity analysed using turnover, spread, volatility, and market depth

Participants can compare fixed-income instruments and evaluate their funding and investment features.

• Government, corporate, municipal, and supranational bonds compared by credit profile
• Coupon, zero-coupon, floating-rate, and inflation-linked structures analysed
• Bond indentures reviewed for covenants, seniority, and event-of-default terms
• Syndicated issuance contrasted with auctions, private placements, and direct lending
• Callable and puttable bonds assessed using embedded option features
• Credit spreads separated into default, liquidity, and risk-premium components

Participants can calculate and interpret core fixed-income valuation and risk measures.

• Present-value bond pricing calculated from coupon, principal, and discount rates
• Yield to maturity distinguished from current yield and realised yield
• Clean price, dirty price, and accrued interest calculated accurately
• Modified duration estimated for parallel interest-rate sensitivity measurement
• Convexity used to refine price changes under larger yield movements
• Key-rate duration applied to non-parallel yield-curve shift scenarios

Participants can analyse foreign-exchange transactions and select appropriate hedging approaches.

• Spot, forward, swap, and non-deliverable forward transactions compared
• Bid-offer conventions and quotation bases interpreted without inversion errors
• Forward points linked to interest-rate differentials and settlement dates
• Transaction, translation, and economic foreign-exchange exposures distinguished
• Hedge ratios selected using exposure timing, certainty, and risk appetite
• Currency settlement risk controlled through payment-versus-payment arrangements

Participants can assess short-term funding instruments and secured financing transactions.

• Treasury bills, commercial paper, and certificates of deposit compared
• Repurchase agreements analysed as collateralised borrowing and lending transactions
• Haircuts set according to collateral quality, volatility, and liquidity
• Reverse repos distinguished from securities borrowing and lending arrangements
• Money-market yield conventions calculated using day-count and discount methods
• Funding concentration monitored by maturity, counterparty, currency, and collateral

Participants can explain listed derivative mechanics, clearing processes and margin requirements.

• Futures, options, and swaps distinguished by contract standardisation features
• Initial margin and variation margin calculated from cleared position movements
• Daily marking to market explained through clearinghouse settlement cycles
• Long and short futures payoffs mapped against underlying price changes
• Option moneyness, intrinsic value, and time value interpreted correctly
• Position limits and expiry management reviewed for listed derivative controls

Participants can assess over-the-counter derivative structures and principal contractual protections.

• Interest-rate, currency, credit, and commodity swaps compared by cash flows
• ISDA Master Agreement terms linked to close-out and default processes
• Credit Support Annex provisions examined for collateral eligibility and valuation
• Confirmation terms matched against trade economics and settlement instructions
• Netting opinions assessed for enforceability across relevant legal jurisdictions
• Clearing thresholds and bilateral margin requirements identified for derivative portfolios

Participants can evaluate collateral arrangements and manage counterparty exposures from trading activity.

• Exposure measurement separates current replacement cost from potential future exposure
• Collateral calls reconciled against agreed valuations, thresholds, and minimum transfers
• Eligible collateral schedules reviewed for concentration and wrong-way risk
• Credit valuation adjustment explained as counterparty credit pricing component
• Margin period of risk linked to liquidation and dispute timelines
• Counterparty limits monitored using ratings, exposures, collateral, and legal status

Participants can select execution approaches using order mechanics, liquidity conditions and cost measures.

• Market, limit, stop, and iceberg orders compared by execution certainty
• Time-weighted average price and volume-weighted average price benchmarks applied
• Implementation shortfall separates decision price, delay, impact, and opportunity costs
• Smart order routing evaluated across fragmented execution venues
• Dealer request-for-quote processes assessed for competitive price discovery
• Best-execution evidence documented through venue, price, cost, and speed criteria

Participants can identify settlement dependencies and design controls for common post-trade failures.

• Trade capture controls validate economics, counterparties, accounts, and booking dates
• Confirmation matching identifies discrepancies before contractual settlement deadlines
• Delivery-versus-payment reduces principal risk during securities settlement
• Settlement fails investigated through instruction status, inventory, and custody records
• Reconciliations compare front-office, custodian, general ledger, and clearing records
• Corporate-action elections controlled through deadlines, entitlements, and client instructions

Participants can measure market exposures and use stress tests to assess adverse scenarios.

• Value at Risk assumptions examined for confidence, horizon, and data limitations
• Sensitivity analysis measures portfolio response to defined market-factor changes
• Stress scenarios combine rate shocks, spread widening, currency moves, and illiquidity
• Liquidity-adjusted Value at Risk considers liquidation costs and market depth
• Funding liquidity risk assessed through contractual maturities and contingent calls
• Risk limits escalated using breaches, trend analysis, and documented governance

Participants can explain how market activities affect capital, liquidity and balance-sheet capacity.

• Basel III capital requirements linked to trading-book and counterparty exposures
• Liquidity Coverage Ratio requirements connected to high-quality liquid asset holdings
• Net Stable Funding Ratio assessed against funding tenor and asset liquidity
• Leverage ratio effects considered when financing securities and derivatives positions
• Funds transfer pricing assigns liquidity and balance-sheet costs to business activity
• Hedging decisions tested against accounting, liquidity, capital, and cash-flow effects

Participants can connect market pricing, valuation controls and financial reporting requirements.

• Fair-value hierarchy classifications assigned using observable market input evidence
• Mark-to-market and mark-to-model approaches compared for valuation governance
• Independent price verification challenges trader marks using external sources
• Valuation adjustments identified for credit, funding, model, and liquidity effects
• IFRS 9 business-model and cash-flow tests classified debt investments
• Hedge accounting documentation links risk objectives, instruments, and effectiveness testing

Participants can identify market-conduct risks and specify appropriate monitoring and escalation controls.

• Inside information assessed for precision, non-public status, and price sensitivity
• Insider dealing controls cover restricted lists, wall crossings, and personal accounts
• Market manipulation patterns include spoofing, layering, marking, and wash trades
• Communication surveillance reviews electronic messages, voice records, and trade timing
• Conflicts registers capture inducements, allocations, research, and personal interests
• Suspicious transaction reports prepared with evidence, chronology, and escalation rationale

Participants can determine key regulatory obligations arising from selected capital-market transactions.

• MiFID II rules examined for classification, suitability, transparency, and execution
• EMIR requirements mapped for clearing, reporting, risk mitigation, and margin
• Transaction reports distinguished from trade reports and derivative repository submissions
• Legal entity identifier data validated for counterparties and reporting entities
• FIX Protocol messages traced from order creation through execution acknowledgement
• Record-retention schedules aligned with trade, communication, valuation, and approval evidence

Participants can structure investment decisions using return objectives, constraints and documented governance.

• Investment policy statements define objectives, constraints, benchmarks, and delegated authority
• Strategic asset allocation links expected returns with risk tolerance
• Diversification assessed using correlation, concentration, and common-factor exposures
• Duration targets aligned with liabilities, liquidity needs, and rate views
• Credit limits established by issuer, sector, rating, and maturity
• Performance attribution separates allocation, selection, currency, and timing effects

Participants can build, review and present a complete market structure and product assessment for a selected treasury or investment transaction.

• Transaction objective defined with funding, investment, hedging, or liquidity requirements
• Market structure map identifies participants, venues, infrastructure, and information flows
• Instrument alternatives compared using cash flows, pricing, liquidity, and risks
• Execution plan specifies order method, counterparties, benchmarks, and approval gates
• Risk-control matrix covers market, credit, collateral, operational, and conduct exposures
• Regulatory obligations documented for classification, reporting, clearing, and record retention
• Final recommendation presented with assumptions, governance actions, and implementation milestones