Fixed Income Market & Analysis (Functional Electives Finance)

Paper Code: 
MBF-522
Credits: 
4.0
Contact Hours: 
40.00
Max. Marks: 
100.00
Objective: 
  • To analyze the fixed income securities markets and its implications for investments.
  • To understand market characteristics, instruments, selling techniques of debt securities.
  • To understand the pricing and valuation issues of fixed and floating rate instruments.
  • To evaluate Risk and return of fixed income securities and their derivatives.
  • To study the role of government, corporate and institutional investors in the debt market.
6.00
Unit I: 
Fixed Income Securities Markets

Overview of Markets, Participants and Scope, Regulatory Framework of Fixed Income Securities Market. Overview of Fixed Income Securities in Emerging Economies.

8.00
Unit II: 
Form and Structure of Securities

Various Types of Securities and their working, Organization and Conduct of Debt Market and the Mechanism, Auction and Selling.

10.00
Unit III: 
Debt security analysis

Bonds and Debenture valuations- Intrinsic Value, Current Yield, Yield to Maturity, Issuers and Investors Perspectives.

6.00
Unit IV: 
General Principles of Credit Analysis

Meaning of Default Risk, Credit Spread Risk, Downgrade Risk, Credit Ratings, Credit Analysis- Assessing Borrower’s Character and capacity to pay, Key ratios used by Credit Analysis to assess the ability of a Company to satisfy its debt obligation & limitations of these ratios.

10.00
Unit V: 
Introduction to Bond Portfolio Management

Investment Management Process- setting the investment objectives, developing & implementing a portfolio strategy, monitoring the portfolio & Adjusting the portfolio., Investment Objective of a Funded Investor, Key Elements of Developing & Implementing a Portfolio Strategy, Active Strategies v/s Passive Strategies.

Essential Readings: 
  • Fixed Income Markets and Their Derivatives, Suresh Sundaresan, Thomson Press,2007.
  • The Bond & Money Markets, Choudhary; Butterworth-Heinemann.2008.
  • Fixed Income & Interest rate derivative analysis – Mark Britten – Jones, 2006.
  • Fixed Income Securities – Fabozzi,MCgrawhill, 2008.
  • Bartlett, W.W., Mortgage Backed Securities, NY. Inst. of Finance, 2009.
References: 
  1. Economic Times, Financial Times
  2. NSE Report
  3. RBI Report