DAY ONE: Financial Markets & City Institutions
Session One 09:00 – 10:30
How do Non-Financial Institutions Interact with the Financial Markets: Financial Markets & Institutions
This session provides the financial markets foundation, terminology and context to be able to understand the dynamics of the financial markets. Parties on one side of the transaction are typically large institutional investors, often acting on behalf of retail investors; on the other side of the transaction, are the entities (issuers) that require finance, either by borrowing (debt markets) or by selling part of their company (equity markets).
- What are the financial markets for?
- Funding choices for corporates: defining capital
- Introduction to city organisations
- What are the financial markets for?
- Funding choices for corporates: defining 'capital'
- Introduction to city organisations
- The role of commercial banks
- How do investment banks differ
- The role of an exchange
- Where does the capital come from: the 'Buy' side
- The role of market regulation
Lunch 13:00 – 14:00
Session Two 14:00 – 15:30
Secondary Markets: Trading Securities
This session explains how securities are traded in the market, distinguishing between over-the-counter transactions and trading “on-exchange”, and the role that brokers play and how they are becoming dis-intermediated as a result of regulatory changes.
- Exchange trading v over-the-counter (OTC) trading
- Accessing secondary markets: the role of the broker
- Electronic trading platform trading types:
- Order v quoted driven systems distinguished
- Order types explained
- Using auctions to establish a price
Session Three 15:45 – 17:30
Making a Market
Delegates will work in teams to compete against each other to make a market and (hopefully) a profit – and in so doing will understand the concept of a “zero sum game”
DAY TWO: Financial Instruments
Session One 09:00 – 13:00
Equity Capital
This session focusses on equity capital, what different forms it takes, where a company might choose to list and on which market, and how to raise further equity capital.
The session concludes with a discussion on the management of the equity base, including the role of dividends and the setting of a “price range” for the shares.
- What do we mean by equity?
- Are all equity instruments the same?
- Which market to choose?
- AIM v Standard v Premium markets
- Raising further equity
- The concept of pre-emption rights
- Setting the discount
- What role does the ex-rights price place in the process
- Managing the capital base
- The dividend decision
- Choosing the share price: stock splits and bonus issues
Lunch 13:00 – 14:00
Session Two 14:00 – 15:30
From Bank Funding to Bond Issuance
This session covers debt funding alternatives, including bank and debt security issuance. The session concludes on what is an appropriate level of debt.
- Bank funding sources
- Committed v uncommitted facilities
- Short v long-term funding
- Why issue a bond?
- Busting bond market jargon
- What form do bond issues take
- Which investors to target: institutional or retail
- Private placement v public issuance
- Where to issue:
- Domestic v foreign
- The US Private Placement market
- Eurobond market
- How is the issuance process managed?
- The role of the lead manager and syndicate
- The book-building process
- Should the issue be underwritten?
- How much debt?
- Debt capacity explained
Session Three 15:45 – 17:30
Managing the Risks
This session looks at the (financial) risks that companies are exposed to and how they can be managed with financial instruments.
- What risks are non-financial institutions typically exposed to?
- Can they be identified?
- Should they be managed?
- Can they be managed?
- Whose responsibility is it to manage those risks?
- Managing currency and interest rate risks
