Investment Operations

Derivatives Operations Fundamentals

Categories Derivatives, Operations

Course Instructor

Course Level

Intermediate

Certification

Certificate

Delivery

Via Zoom

Hours (EST)

9:00 am - 1:00 pm​

Description

*This course can also be offered upon request and can be customized to fit your team’s needs.

Date: TBD

The Derivatives Operations Fundamentals virtual course is designed to provide a thorough and highly structured primer on the subject of derivatives, and what post-trade execution actions must occur in order to effect timely settlement thereby retaining trading profits and maintaining satisfied clients. The objectives of the course are for delegates to:

  1. Become aware of the essential purpose and use of derivatives
  2. Understand how derivative exchanges operate
  3. Appreciate the similarities & differences between exchange-traded and OTC derivatives
  4. Identify the meaning of ‘position’, and how trades impact positions
  5. Become aware of the role of floating benchmarks in derivative trades
  6. Appreciate what triggers payoff in derivative trades and positions
  7. Understand how settlement is actioned in derivative trades
  8. Appreciate the characteristics of numerous types of OTC derivative product

By the end of the course, each attendee will be equipped to:

  1. Apply all concepts to whichever part of derivatives processing they are responsible for
  2. Understand how exposures arise in OTC derivatives
  3. Understand the collateral management process relating to OTC derivatives
  4. The content and implications of the European Market Infrastructure Regulation (also refer to the OTC Derivatives, Collateral & EMIR course)

Prerequisite: None

 Who Should Attend

Novice operations audience as well as existing employees that would benefit from a broader understanding of derivatives processing (typically with up to 3 years’ experience). The course is equally applicable to people within institutional investment firms (e.g. pension funds, mutual funds, insurance companies) and investment banks, and to those working within central banks, derivative exchanges, central securities depositories, custodians and management consultants. The course contains essential concepts that all operations personnel should be aware of, such as how currency amounts are paid and received, the risks involved in issuing settlement instructions, how cash settlement risk is typically mitigated, and the circumstances which triggers payoff for a range of derivative products. Active participation of the delegates will be encouraged, and exercises will be introduced at frequent and appropriate points.

Agenda

Day 1

Introduction

  1. Definition of Derivatives
  2. What Are Derivatives?
  3. Generic Purpose and Use

Categories of Derivative Products

  1. Futures, Options, Swaps: Overview
  2. Exchange-Traded Derivatives: Overview
  3. OTC Derivatives: Overview
  4. Similarities & Differences

Exchange-Traded Derivative Products

  1. Characteristics of Futures
  2. Characteristics of Options

OTC Derivatives: Generic Characteristics

  1. Generic Trade Components
  2. Interest Rates: Fixed vs Floating
  3. Legal Documentation: Overview
  4. Trades versus Positions
  5. The Trade Lifecycle: Generic Aspects
  6. The Trade’s Lifetime: Generic Actions
  7. OTC Derivative Products
  8. Interest Rate Derivatives

Day 2

OTC Derivative Products Interest Rate Derivatives

  1. Interest Rate Cap
  2. Interest Rate Floor
  3. Interest Rate Collar
  4. Swaption
  5. Swaption Exercise/Expiry

Cross-Currency

  1. Fixed vs Fixed CCS
  2. Fixed vs Floating CCS
  3. Floating vs Floating CCS
  4. Non-Deliverable Swap
  5. Notional Reset Swap
  6. Constant Maturity Swap

Inflation Derivatives

  1. Inflation Swap
  2. Zero-Coupon Inflation Swap
  3. TIPS Asset Swap
  4. Total Return Swap

Credit Derivatives

  1. Credit Default Swap (Single Name)
  2. Loan Credit Default Swap
  3. Contingent Credit Default Swap
  4. Basket Default Swap
  5. Credit Default Swap Index

Summary & Questions

In-House Training

Custom Training can help you achieve your corporate training goals while staying on budget and focusing the content on the needs of your group. Email your questions regarding corporate training to training@investmentoperations.net.

2024 Training Calendar

Training Catalogue

Course Instructor

Course Level

Intermediate

Certification

Certificate

Delivery

Via Zoom

Hours (EST)

9:00 am - 1:00 pm​

Description

*This course can also be offered upon request and can be customized to fit your team’s needs.

Date: TBD

The Derivatives Operations Fundamentals virtual course is designed to provide a thorough and highly structured primer on the subject of derivatives, and what post-trade execution actions must occur in order to effect timely settlement thereby retaining trading profits and maintaining satisfied clients. The objectives of the course are for delegates to:

  1. Become aware of the essential purpose and use of derivatives
  2. Understand how derivative exchanges operate
  3. Appreciate the similarities & differences between exchange-traded and OTC derivatives
  4. Identify the meaning of ‘position’, and how trades impact positions
  5. Become aware of the role of floating benchmarks in derivative trades
  6. Appreciate what triggers payoff in derivative trades and positions
  7. Understand how settlement is actioned in derivative trades
  8. Appreciate the characteristics of numerous types of OTC derivative product

By the end of the course, each attendee will be equipped to:

  1. Apply all concepts to whichever part of derivatives processing they are responsible for
  2. Understand how exposures arise in OTC derivatives
  3. Understand the collateral management process relating to OTC derivatives
  4. The content and implications of the European Market Infrastructure Regulation (also refer to the OTC Derivatives, Collateral & EMIR course)

Prerequisite: None

 Who Should Attend

Novice operations audience as well as existing employees that would benefit from a broader understanding of derivatives processing (typically with up to 3 years’ experience). The course is equally applicable to people within institutional investment firms (e.g. pension funds, mutual funds, insurance companies) and investment banks, and to those working within central banks, derivative exchanges, central securities depositories, custodians and management consultants. The course contains essential concepts that all operations personnel should be aware of, such as how currency amounts are paid and received, the risks involved in issuing settlement instructions, how cash settlement risk is typically mitigated, and the circumstances which triggers payoff for a range of derivative products. Active participation of the delegates will be encouraged, and exercises will be introduced at frequent and appropriate points.

Agenda

Day 1

Introduction

  1. Definition of Derivatives
  2. What Are Derivatives?
  3. Generic Purpose and Use

Categories of Derivative Products

  1. Futures, Options, Swaps: Overview
  2. Exchange-Traded Derivatives: Overview
  3. OTC Derivatives: Overview
  4. Similarities & Differences

Exchange-Traded Derivative Products

  1. Characteristics of Futures
  2. Characteristics of Options

OTC Derivatives: Generic Characteristics

  1. Generic Trade Components
  2. Interest Rates: Fixed vs Floating
  3. Legal Documentation: Overview
  4. Trades versus Positions
  5. The Trade Lifecycle: Generic Aspects
  6. The Trade’s Lifetime: Generic Actions
  7. OTC Derivative Products
  8. Interest Rate Derivatives

Day 2

OTC Derivative Products Interest Rate Derivatives

  1. Interest Rate Cap
  2. Interest Rate Floor
  3. Interest Rate Collar
  4. Swaption
  5. Swaption Exercise/Expiry

Cross-Currency

  1. Fixed vs Fixed CCS
  2. Fixed vs Floating CCS
  3. Floating vs Floating CCS
  4. Non-Deliverable Swap
  5. Notional Reset Swap
  6. Constant Maturity Swap

Inflation Derivatives

  1. Inflation Swap
  2. Zero-Coupon Inflation Swap
  3. TIPS Asset Swap
  4. Total Return Swap

Credit Derivatives

  1. Credit Default Swap (Single Name)
  2. Loan Credit Default Swap
  3. Contingent Credit Default Swap
  4. Basket Default Swap
  5. Credit Default Swap Index

Summary & Questions

In-House Training

Custom Training can help you achieve your corporate training goals while staying on budget and focusing the content on the needs of your group. Email your questions regarding corporate training to training@investmentoperations.net.

2024 Training Calendar

Training Catalogue

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