The Course Outlines:

Treasury Risk Management

• Role of the treasurer
• Role of the CFO
• Functions of a treasury
• Profit centres and cost centres
• Netting and in-house banks
• Importance of policies, procedures and risk management controls

Treasury Solutions – Currency Risk

• Client exposure management
• Hedging solutions - market
• spot foreign exchange
• base and variable currencies
• cross rates
• forward foreign exchange
• forward pricing
• forward points
• foreign exchange swaps
• currency swaps
• exchanges of principal
• gross and net settlement of differentials
• relationship to forward market
• advantages over forward market
• currency options
• comparison with the forward market
• ‘Natural’ hedging

How Hedging Works

• Identifying and analysing risk
• types of risk
• long and short positions
• Hedging
• physical delivery
• contracts for differences
• the importance of carry
• put/call parity
• the role of leverage in derivatives hedges
• OTC and exchange traded products
• how initial and variation margins work
• Herstatt risk
• DVP, PVP & CLS Bank
• symmetrical and asymmetrical risk management
• equal and opposite positions
• correlation and partial hedges
• when is a hedge a speculative position?
• IAS 39

Evaluating the Benefits of Treasury Management

• Evaluating upside and downside risks
• Advising clients on risk management
• Managing costs

Money Markets and Interest Rate Risk

• TBills, CDs, CP, ABCP
• IBORs, IBIDs, IMEANs and the interbank money markets
• Repos, Securities Lending and Sell/Buy backs
• Day count conventions: act/360, 30/360, act/act ....
• Discounts and yields
• Present values, future values, IRRs, YTMs and AICs
• ICMA 803.1 & 803.2

Understanding Money Market/Swap Market Yield Curves

• Liquidity preferences
• Preferred habitats
• Market expectations
• Market segmentation
• Efficient markets?