Introduction:
- Overview over Financial Markets
- Risk and Return Characteristics
- Current developments
- Cash Flows - the Underlying of any Financial Instrument
Time Value of Money and Interest Rates (I):
- Factors determining the Value of Money
- Future Value and Present Value
- Discount Factors and Compound Factors
- Yield versus Return
- Differences between Capital Markets and Money Markets
Explanation of the commonly used Market Conventions:
- US Bond Basis
- US Money market Basis
- ISMA Convention
- Actual/Actual
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Payment Day Convention
- Preceding and Following Payment Day Convention
- Modified Following Payment Day Convention
- FRN Convention
Money Market Instruments:
- Discounted Securities versus Interest-bearing Securities
- Interest-Rate Calculations
Forward Markets:
- Developing a Forward Market from Deposits
- Forward Rate Agreements (FRA's)
- Interest Rate Futures
Foreign Exchange Markets:
- Spot FX
- Forward Outright
- FX Swaps
- Covered Interest Arbitrage
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