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An Introduction to Trading in the Financial Markets: Global Markets, Risk, Compliance, and Regulation

Book Description

Succeeding in the financial markets requires a mastery of many disciplines. Mastery begins with understanding the actors, rules, and dynamics, and the ways in which they interact. This volume, the last of a 4-volume series, presents a broad perspective on key subjects such as regulation and compliance, risk and ways to mitigate it, and the directions in which trading markets might evolve. Like its predecessors, it presents alternative versions of the future: will the sell side or buy side come to dominate, for example, and how might new technologies shape global markets? Mastery of the financial markets begins with its authoritative, heavily illustrated presentation.



-- Provides easy to understand descriptions of all the major elements of the financial markets
-- Author is a 28-year veteran of the financial markets
-- Filled with graphs and charts that help readers move quickly and easily through the book
and acquire the necessary information

Table of Contents

  1. Cover Image
  2. Content
  3. Title
  4. Copyright
  5. Preface for the Set
  6. Preface
  7. Overview
  8. Visual Glossary
  9. Future
  10. PART 1. Global Markets
    1. Introduction
    2. 1. Geography
      1. Regional Structure
    3. 2. Instruments
      1. Primary Instruments
      2. Secondary Instruments
    4. 3. Entities
      1. Buy-Side Entities
      2. Sell-Side Entities
      3. Trading Venues
    5. 4. Trading Practices
      1. Buy-side Trading Practices
      2. Sell-Side Trading Practices
    6. 5. Issues
      1. Centralization versus Decentralization
      2. Electronic Trading
      3. Latency
      4. Related Information in Other Books
  11. PART 2. Risk
    1. Introduction
    2. 1. Type of Loss
      1. Instrument Loss
      2. Position or Portfolio Loss
      3. Department or Division Loss
      4. Firm Loss
      5. Support Entity Loss
      6. National Market Loss
      7. Global Market Loss
    3. 2. Kinds of Risk
      1. Business Risk
      2. Environmental, Societal, and Governmental Risk
      3. Financial Risk
      4. Market Risk
      5. Operational Risk
      6. Credit Risk
      7. Liquidity Risk
      8. Counterparty Risk
      9. Regulatory Risk
      10. Systemic Risk
      11. Other Definitions of Risk
    4. 3. Causes of Risk
      1. Prices
      2. Fat Tails
      3. Theft
      4. Hubris
      5. Greed and Ego
      6. Ignorance
      7. Wishful Thinking
      8. Lax Controls
      9. Wesons
    5. 4. Risk Mitigation
      1. Risk Warnings
      2. Protection
    6. 5. Organization of Risk
    7. 6. Regulatory Actions
      1. The Group of Thirty
      2. Basel I, II, and III
      3. Dodd-Frank
      4. Prudential Regulations
    8. 7. Issues of Risk
      1. Related Information in Other Books
  12. PART 3. Compliance
    1. Introduction
    2. 1. Types
      1. Regulatory Types
      2. Financial Types
      3. Operational Types
      4. Customer Types
      5. Contractual Types
    3. 2. Support and Organization
      1. Support
      2. Organization
      3. Related Information in Other Books
  13. PART 4. Regulation
    1. Introduction
    2. 1. Span of Regulation
      1. Entity
      2. Province or State
      3. National Regulation
      4. Transnational Regulation
      5. Commercial Codes
    3. 2. Regulatory Implementation
      1. Self-Regulation
      2. Governmental Regulation
      3. Hybrid Regulation
    4. 3. Regulatory Functions
      1. Entity or Function
      2. Trading Market
      3. Primary Market
      4. Enforcement
      5. Executive Body
    5. 4. Goals for Regulation
      1. Financial Responsibility
      2. Customer Protection
      3. Professionalism
      4. Transparency
      5. Conflicts of Interest
      6. Best Execution
      7. Competitive Parity
      8. Market Fairness
      9. National Market Defense/Protection
    6. 5. Geographic Regulation
      1. United Kingdom
      2. United States
      3. European Union
      4. Basel Committee on Banking Supervision
      5. Rest of the World
    7. 6. Types of Regulation
      1. Entity
      2. Markets
      3. Support Activities
    8. 7. Regulation Concepts
      1. Rules-Based Regulation
      2. Principles-Based Regulation
      3. Injunctions
      4. Functional Regulation
    9. 8. Regulation Issues
      1. Globalization
      2. Competition
      3. Systemic Risks
      4. Related Information in Other Books
  14. PART 5. Playing the Game
    1. Introduction
      1. The Context
    2. 1. Step 1
      1. The Portfolio Manager
      2. Market Conditions
      3. Technology
      4. Process
      5. Things We Did Not Consider
    3. 2. Step 2
      1. Buy-Side Trader
      2. Market Conditions
      3. Technology
      4. Process
      5. Things We Did Not Consider
    4. 3. Step 3
      1. Sales Trader
      2. Market Conditions
      3. Technology
      4. The Process
      5. Things We Did Not Consider
    5. 4. Step 4
      1. Trading Venues
      2. Market Conditions
      3. Technology
      4. Process
      5. Things We Did Not Consider
    6. 5. Step 5
      1. Purchases and Sales, the Sales Trader, and the Buy-Side Trader
      2. Market Conditions
      3. Technology
      4. Process
      5. Things We Did Not Consider
    7. 6. Step 6
      1. Portfolio Accounting
      2. Technology
      3. Process
      4. Things We Did Not Consider
    8. 7. Step 7
      1. Participants
      2. Market Conditions
      3. Technology
      4. Process
      5. Things We Did Not Consider
    9. 8. Step 8
      1. Participants
      2. Technology
      3. Process
      4. Things We Did Not Consider
      5. Related Information in Other Books
    10. Conclusion
      1. Book 1: An Introduction to Trading in the Financial Markets: Market Basics
      2. Book 2: An Introduction to Trading in the Financial Markets: Trading, Markets, Instruments, and Processes
      3. Book 3: An Introduction to Trading in the Financial Markets: Technology—Systems, Data, and Networks
  15. Glossary
  16. Index