UNDERSTAND MONEY MARKETS (securities, repo's)
- Description
- Curriculum
- FAQ
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Welcome!
My name is Michiel van den Broek. After working in finance from 1990, I design financial courses since 2005 to make ‘complex’ finance easy, based on my view that finance is not rocket science.
The money markets are a vital financial market that is essential to our economy as explained in my Udemy course Understand Banks and Financial Markets, in which thousands of students already enrolled.
This course, Understand Money Market will learn you about the main products traded on the money markets: deposits, money market securities and repurchase agreements. The course contains more than 1,5 hours of mp 4 video’s accompanied with downloadable pdf documents (total 20 pages) and quizzes to test your skills and understanding with multiple choice questions (total 34).
Section 2 skills you to understand and make basic interest rate calculations covering several topics such as:
- specific day count conventions
- calculation of single interest coupons
- present and future value calculations
- compare yields with different coupon frequency or day count conventions
- how to compare pure discount with true yield
- the yield curve and implied forward rates
Section 3 is an introduction to traditional money markets benchmarks and products covering topics, such as:
- how and why use money market products
- the domestic- and Euromarkets
- explain several deposit types
- LIBOR and recently introduced overnight money market benchmarks
Section 4 covers Tradable Money market securities, such as:
- characteristics of main securities:
treasury bills, certificates of deposit and commercial paper - the calculation of initial consideration at issue date
- the maturity consideration and interest calculation for different products
Finally, section 5 provides in depth knowledge and understanding of repurchase agreements, repos. The topic basket of this section includes:
- legal and economic ownership
- collateral types
- GMRA documentation and failure to deliver collateral
- special trading
- sell/buy back transactions
- reprising versus margins
- repo agents
- the use of hold in custody repos (HIC) used by central banks
Please contact me if you have any questions regarding the course program.
Thank you for your interest!
Michiel van den Broek
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2
Basic Interest Rate calcuations: IntroductionAll yields and returns are always annual based percentages. But there are different day count conventions, coupon frequencies and cash flow calculations.
Studying the basic interest rate calculation section gives you the understanding and skills needed the money market products covered in following sections. But these skills can also be used for other financial products that are not covered in this course, such as bonds, currency derivatives and interest rate swaps.
Following topics are covered in five lectures specific day count conventions, calculate coupon amounts for single interest coupons, present value calculations, coupon frequency impact, the difference between pure discount and true yield, conversion of rates, the yield curve and implied forward rates.
Lecture 3. BIC Part 1: Yield, coupon and rate of return.
Lecture 4. BIC Part 2: Day count conventions, regular and broken period yield calculation, apply conventions following, modified following and end-of-month conventions.
Lecture 5. BIC Part 3: Present / Future value calculations and coupon frequency.
Lecture 6. BIC Part 4: True yield versus pure discount and conversion.
Lecture 7. BIC Part 5: Yield curve shapes and implied forward rate.
These sections contain in total 32 minutes of mp4 video lectures with power point slides. Also you can download pdf documents accompanying the lectures, in total 8 pages. You can test your understanding and practice calculations by several quizzes with total 19 multiple choice questions .
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3
Basic Interest Rate calculations (BIC) Part 1 Yield, coupon and rate of return
Yield, coupon and rate of return
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4
Quiz part 1Yield, coupon and rate of return
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5
2. BIC Part 2: Day count conventions and broken periods
Day count conventions, regular and broken period yield calculation, apply conventions following, modified following and end-of-month conventions
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6
Quiz Part 2
Day count conventions and broken periods
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7
BIC Part 3: Present / Future value calculations and coupon frequency
Present / Future value calculations and coupon frequency
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8
Quiz Part 3
Present / Future value calculations and coupon frequency
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9
BIC part 4: True yield versus pure discount and conversion
True yield versus pure discount and conversion
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10
Quiz Part 4
True yield versus pure discount and conversion
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11
BIC Part 5: Yield curve shapes and implied forward rate
Yield curve shapes and implied forward rate
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12
Quiz Part 5
Yield curve shapes and implied forward rate
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14
Money market securities
This section explains tradable money market securities, such as treasury bills, certificates of deposit and commercial paper.
The main section topics are:
Features of different types of money market securities
T-Bills auctions in the UK and USA
The calculation of initial consideration at issue date of US T-bills (pure discount) and other securities (pure yield)
Maturity considerations
Coupon bearing certificates of deposit specifications
The issue of commercial paper issued by companies
This sections contains a 12 minute mp4 video lectures with power point slides.
There is a quiz with 5 multiple choice questions to test your understanding and practice calculations.
To prepare the mp4 lecture, please download the pdf document that contains 3 pages of notes to the power point slides.
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15
Quiz money market securities
Money market paper proceed and returtn calculations
