Certified International Finance Analyst

Introduction

• The Challenge of International Finance
• Finance Function in a Global Context
• Global Financial Markets
• Taxonomy of Financial Markets
• Percentage of GDP Arising from Exports
• Getting a Grip on Globalization

Offshore Markets

• Euro or Offshore Markets: What are They?
• Evolution of Offshore Markets
• Interest Rates in the Global Money Markets
• Sample Problems

The Monetary System

• Introduction
• Objectives of IMF
• Fund’s Role of Consultation
• Sources of Funds – Quotas
• Share Capital of IMF
• Other Sources of Funds
• Fund’s Lending Operations
• Standby Arrangements
• IMF Charges
• Other Facilities
• Exchange Rates and Par Values
• International Monetary Reforms
• International Liquidity
• Need for Reserves
• Composition and Level
• Adequacy of Reserves
• Problems of Liquidity
• Augmentation of Liquidity
• Special Drawing Rights (SDR)
• SDRs in India
• India’s IMF Net Position
• Additional SDRs

Classic Systems of Exchange Rates

• The Classical Gold-standard System
• Price Adjustment under the Gold Standard
• Price Adjustment under the Gold-Exchange and Dollar Standards

Alternative Systems Of Exchange Rates

• The European Monetary System (EMS)
• Price Adjustment under the EMS
• Hybrid Systems of Exchange Rates
• Mixed Fixed and Flexible Rates

Cooperative Intervention in Disorderly Markets

• Target Zones

Balance of Payments

• Introduction
• Balance of Payments Accounting
• Debits and Credits
• Balance of Payments Statement
• The Current Account
• The Capital Account
• Debit and Credit Entries
• Balance of Payment Crisis

Foreign Exchange Market

• Definition
• International Financial System and Foreign Exchange Market
• Foreign Sector and Foreign Exchange Market
• Banks Purchase and Sale
• Instruments of Credit Traded
• Foreign Exchange Market Components
• Gustav’s Theory
• Limitations
• Spot and Forward Rates
• Speculation
• Arbitrage
• Indian Foreign Exchange Market
• Exchange Dealers
• RBI and Exchange Market
• Floating Vs Fixed Exchange Rates
• RBI Policy Applied to Banks
• Trading by Banks
• Spot Trading Operations
• Exchange Rates in India
• Cross Currency Deals
• Mismatch - Need for Matching
• Forex Management
• Explanation of Cross Rates
• Derivative Products
• Forward Contracts Swaps
• Futures and the Options
• Forward Rate Agreements (FRA)
• Forward and Future Contracts
• Currency and Interest Rate Swaps
• Sodhani Committee Report ()
• Capital Account Convertibility Measures

Euro-Currency Market

• International Money and Capital Markets
• Exchange Markets vs Currency Markets
• Origins of the Euro-Currency Markets
• Dealers in the Market
• Euro-bond Markets
• Magnitude of Trade
• Euro Bond Clearing and Settlement System
• Petro-Dollar Market

International Financial Institutions

• International Finance Corporation
• The Multilateral Investment Guarantee Agency (MIGA)
• A Global Cooperative
• The IMF’s Financial Policies and Operations

Spot and Forward Market

• Organization of the Foreign Exchange Market
• The Mechanics of Spot Transactions
• The Forward Market

Currency Futures and Options Markets

• Futures Contracts
• Basic Differences Contracts Futures between Forward and
• Advantages and Disadvantages of Futures Contracts
• Arbitrage between the Futures and Forward Markets

Options Prices

• Option Pricing and Valuation
• Reading Currency Futures and Options Prices

Swaps and Interest Rate Derivatives

• Interest Rate and Currency Swaps
• Interest Rate Swaps
• Exhibit: Classic Swap Structure
• Economic Advantages of Swaps
• Interest Rate Forwards and Futures
• Forward Rate Agreement
• Eurodollar Futures

Management of Foreign Exchange Risk

• What is Exchange Risk?
• Translation Exposure
• Transaction Exposure
• The Exposure Problem
• Tools and Techniques of Foreign Exchange Risk Management

Management of Translation Exposure

• The Monetary/Non-monetary Method
• Temporal Method
• The Current/Non-current Method

International Financial Management

• Working Capital Management
• Portfolio Management
• Transfer Pricing
• International Taxation
• International M&A