Introduction to Fixed Income - Virtual Class

Once considered a safe haven, fixed income investing now presents an array of choices for every risk profile. This program provides a basic and comprehensive overview of the fixed income market. It covers basic bond terminology, bond fundamentals, yield calculations and the specifics of corporate, government and municipal bonds.

Take this class without ever leaving the office via our Virtual Classroom (Virtual NYIF). Accessible from any internet connected computer - regardless of where you are geographically. All you need is an internet connection, a browser and speakers or audio headphones!

17-Apr-2012 -- 08-May-2012VirtualUSD$875
Virtual Class Session5:30pm - 7:00pmInstructional Method:
Group-Live
Instructor(s): [ Angelo DeCandia; ] Tue Level: Basic

CPE CREDITS
6
Designed for those new to the bond market, as well as for those in related areas of the business seeking to expand their knowledge of this market.
Participants must have an internet connected computer with sound capabilities.
Students will be able to:
  • Explain the basics of bonds
  • Describe the fixed income market
  • Understand bond prices, including percentage values, quotation conventions, conversions and premium pricing
  • Understand accrued interest and standard payment dates, trade and settlement dates, accrued interest calculations
  • Calculate nominal yield, current yield, real yields and yield to maturity
  • Understand duration analysis - definition, calculation, interpretation, limitations and advantages
  • Explain a conceptual framework for fixed income investing and the risk involved
  • List the fixed income products available to your clients and discuss their specific suitability
  • Understand and describe Federal Reserve policies and activities and their impact on fixed income markets
  • Understand more complicated products such as mortgage-backed bonds and interest-rate swaps
Powered by Virtual NYIF
This is a LIVE online class
Take this class without ever leaving the office via our Virtual Classroom (Virtual NYIF). Accessible from any internet connected computer - regardless of where you are geographically. All you need is an internet connection, a browser and speakers or audio headphones!
Session 1: Bond Basics
Bond Fundamentals
  • Borrowers vs. Lenders
  • Bond Indentures & Covenants
  • Bond Descriptions

Bond Characteristics

  • Coupon
  • Maturity
  • Price
  • Yield

Bond Pricing /Yields

  • Fixed vs. Floating
  • Bullet vs. Amortized
  • Meaning & Use of Yield
  • Accrued Interest
  • Basis Points
  • Day Count Methods
  • Pricing as a Spread to Treasury

                          Duration: 1.5 hours

Session 2: Fixed Income Risks
Bond Risks
  • Default risk
  • Credit risk
  • Inflation risk
  • Call risk
  • Liquidity risk
  • Event risk
  • Interest rate risk
  • Reinvestment risk
  • Credit risk vs. market risk

The Yield Curve

  • Typical shapes
  • How the curve changes
  • Information inherent in such changes

Managing Interest Rate Risk -Duration Analysis

  • Definition
  • Calculation - explained
  • Interpretation
  • Limitations/advantages
  • Convexity

Bond Ratings

  • Ratings Agencies
  • Watchdogs or Conflict of Interest?
  • Quality Determination
  • Credit Analysis

                        Duration: 1.5 hours

Session 3– Fixed Income Marketplace & Structure
The Market for Trading
  • Primary vs. Secondary
  • The Special Role of the Federal Reserve
  • Making a Market
  • Auctions
  • Dealers, Brokers and Bond Exchanges

Structure of an Issue

  • Secured vs. unsecured bond
  • Senior vs. subordinated bond
  • Callability
  • Structure of the call feature
  • The indenture

U.S. Government Securities

  • Bills, Notes & Bonds
  • On-the-run issues
  • Inflation-Adjusted TIPS
  • Discount Yield
  • Bond Equivalent Yield

The Corporate Bond Markets

  • Types of issuers (Utility, Industrial, Transportation, Financial, etc.)
  • Investment Grade vs. High Yield
  • Credit Analysis
  • Bank Loans

The Role of Government in the Economy

  • Major Macroeconomic Variables
  • Key Interest Rates
  • Fiscal vs. Monetary Policy

                      Duration: 1.5 hours

Session 4 – Fixed Income Alternative Products
Convertible Bonds
  • Conversion Value
  • Conversion Parity
  • Convertible Pricing
  • Motivations for Issuers & Bondholders

Preferred Stock

  • Why it is a Fixed-Income product
  • Differences from Common Stock
  • Preferred Pricing

Mortgage Securities

  • Traditional mortgages vs Mortgage Origination
  • Mortgage Pools
  • Mortgage Securitizers
  • Pass-Thrus
  • Sequential CMOs
  • PAC CMOs
  • I/O’s vs. P/O’s

Asset Backed Securities

  • Credit cards
  • Auto loans
  • Student loans
  • Corporate debt

Non U.S. Bond Markets

  • The 3 Questions (Currency Denomination, Place of Issuance, Who is the Issuer?)
  • Yankee Bonds
  • Foreign Bonds
  • Eurodollar Bonds

Spot vs. Forward vs. Futures (rates & markets)

  • Differences explained
  • Use in forecasting
  • Use in hedging

Foreign Exchange (FX)

  • Currency Quotes (Stronger vs. Weaker)
  • Causes of Currency Change
  • The FX Market

The Repo Market

  • Mechanics of a Repo transaction
  • Borrowers vs. Lenders
  • Purpose of Repos

The Swaps Market

  • Inception of the Swaps Market
  • Evolution of Swaps Dealers
  • Interest-Rate Swaps
  • • Currency Swaps
  • • Role of the Swaps Curve

              Duration: 1.5 hours