CFA LEVEL 1- Fixed Income

Regular price Rs.5,499.00

Basic Info : Fixed Income
Level : CFA LEVEL 1
Commitment  : 14 hour (7 sessions of 2 hours each)
Language : English
Schedule Date To Be Announced Soon

What Will I Learn

When you are done with this course, you will be able to:

  • Examine the fundamental elements underlying bond returns and risks with a specific focus on interest rate and credit risk.
  • Measure and analyze credit risk of fixed income securities.
  • Evaluate credit risk and use credit analysis for risky bonds
  • Determine key measures for assessing a bond’s sensitivity to interest rate risk


Introduction to Fixed-Income Securities

  • Basic features of a fixed income security
  • Bond indenture
  • Affirmative and negative covenants
  • How legal, regulatory and tax considerations affect the issuance and trading of fixed income securities
  • How cash flows of fixed income securities are structured

Fixed-Income Markets- Issuance, Trading & Funding– I

  • Global fixed-income markets
  • Use of interbank offered rates as reference rates in floating-rate debt
  • Mechanism available for issuing bonds in primary markets
  • Secondary markets for bonds
  • Securities issued by sovereign governments
  • Securities issued by non-sovereign governments, quasi government entities and supranational agencies
  • Types of debt issued by corporations
  • Structured financial instruments
  • Repurchase agreements (repos) and the risks associated with them

Fixed-Income Valuation- I

  • Calculate a bond’s price given a market discount rate
  • Identify the relationship among a bond’s price, coupon rate, maturity and market discount rate (yield-to-maturity)
  • Spot rates and their calculation
  • Flat price, accrued interest and the full price of a bond
  • Matrix Pricing
  • Operating and Non-operating components of the income statement
  • Calculate and interpret yield measures for fixed rate bonds, floating-rate notes and money market instruments
  • Spot curve, yield curve on coupon bonds, par curve, and forward curve
  • Calculate spot rates from forward rates, forward rates from spot rates and the price of bond using forward rates
  • Yield spread measures

Asset Backed Securities- I

  • Benefits of securitization for economies and financial markets
  • Typical structure of securitization, including credit tranching and time tranching
  • Residential mortgage loans that are typically securitized
  • Residential mortgage backed securities and collateralized mortgage obligations, cash flow and risk of each type
  • Pre-payment risk of mortgage-backed securities
  • Commercial mortgage-backed securities
  • Non-mortgage asset- backed securities
  • Collateralized debt obligation, including their cash flows and risks

Understanding Fixed Income Risk and Return- I

  • The sources of return from investing in a fixed rate bond
  • Macaulay, modified and effective durations
  • Uses of key rate duration in measuring the sensitivity of bonds to changes in the shape of the benchmark yield curve
  • Bond maturity, coupon and yield level affect its interest rate risk
  • Duration and limitation of a portfolio

Understanding Fixed Income Risk and Return- II

  • Calculate the money duration of a bond and price value of a basis point (PVBP)
  • Approximate and effective convexity
  • Effect of term structure of yield volatility on the interest rate risk of a bond
  • How changes in credit spread and liquidity affect yield-to-maturity of a bond
  • How duration and convexity can be used to estimate the price effect of the changes

Fundamentals Of Credit Analysis

  • Credit risk and credit-related risks affecting corporate bonds
  • Default probability and loss severity as components of credit risks
  • Seniority rankings of corporate debt
  • The potential violation of the priority of claims in a bankruptcy proceedings
  • Risks in relying on ratings from credit rating agencies
  • Four Cs of traditional credit analysis
  • Financial ratios used in credit analysis
  • Factors influencing the level and volatility of yield spreads
  • Special consid erations when evaluating the credit of high yield, sovereign and non- sovereign government debt issuers and issues

How It works

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Each session is interactive and informative, featuring case studies, quizzes and projects

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