The differences between a security and a derivative
- fundamental financial claims – ownership of equity vs. a derivative claim which is contractually bound to the performance of an underlying or fundamental claim
The principal types of equities
- ordinary (common) shares
- preference shares
- convertible securities
- ranking for dividends
- liquidation priority
Issuance of equities
- stages of IPOs
- private placements
- secondary offerings
- rights issues
- role of underwriters
Equity markets and trade execution
Order driven/quote driven platforms
- alternative trading venues
- dark pools
- order types
- trade settlement
Warrants, Covered warrants and Contracts for Difference (CFDs)
- relative risks of warrants and covered warrants
- mechanics of a CFD
High Frequency Trading
- market making
- liquidity provisioning
- flash crashes
Equity valuation
- dividend discounting models
- financial ratios
- fundamental analysis
Historical overview of equity market returns
- P/E ratios
- comparison with returns on other asset classes
- over-valuation indicators
- risk premium
- overview of Capital Asset Pricing Model (CAPM) and portfolio theory
Review of major equity indices
- market classifications
- major markets
- emerging markets

UNIT 1