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Financial Markets Operations Management

Book Description

A comprehensive text on financial market operations management

Financial Market Operations Management offers anyone involved with administering, maintaining, and improving the IT systems within financial institutions a comprehensive text that covers all the essential information for managing operations. Written by Keith Dickinson—an expert on the topic—the book is comprehensive, practical, and covers the five essential areas of operations and management including participation and infrastructure, trade life cycle, asset servicing, technology, and the regulatory environment. This comprehensive guide also covers the limitations and boundaries of operational systems and focuses on their interaction with external parties including clients, counterparties, exchanges, and more.

This essential resource reviews the key aspects of operations management in detail, including an examination of the entire trade life cycle, new issue distribution of bonds and equities, securities financing, as well as corporate actions, accounting, and reconciliations. The author highlights specific operational processes and challenges and includes vital formulae, spreadsheet applications, and exhibits.

  • Offers a comprehensive resource for operational staff in financial services

  • Covers the key aspects of operations management

  • Highlights operational processes and challenges

  • Includes an instructors manual, a test bank, and a solution manual

  • This vital resource contains the information, processes, and illustrative examples needed for a clear understanding of financial market operations.

    Table of Contents

    1. Preface
      1. Note
    2. Acknowledgements
    3. PART ONE
      1. CHAPTER 1 Introduction to Operations
        1. 1.1 Introduction
        2. 1.2 Organisational Structure of an Investment Company
        3. 1.3 Operations' Relationships
        4. 1.4 Other Business Functions
        5. 1.5 Summary
        6. Notes
      2. CHAPTER 2 Financial Instruments
        1. 2.1 Introduction
        2. 2.2 Why Do We Issue Financial Instruments?
        3. 2.3 Money Market Instruments
        4. 2.4 Debt Instruments
        5. 2.5 Equity Instruments
        6. 2.6 Derivative Instruments
        7. 2.7 Exchange-Traded Derivatives
        8. 2.8 OTC Derivatives
        9. 2.9 Summary
        10. Notes
      3. CHAPTER 3 Data Management
        1. 3.1 Introduction
        2. 3.2 Importance of Reference Data and Standardisation
        3. 3.3 Types of Reference Data
        4. 3.4 Data Management
        5. 3.5 Legal Entity Identification
        6. 3.6 Summary
      4. CHAPTER 4 Market Participation
        1. 4.1 Introduction
        2. 4.2 Market Players
        3. 4.3 Market Structure
        4. 4.4 Summary
        5. Notes
    4. PART TWO
      1. CHAPTER 5 Clearing Houses and CCPs
        1. 5.1 Introduction
        2. 5.2 Overview of Clearing and Settlement
        3. 5.3 The Clearing House Model
        4. 5.4 The Central Counterparty Model
        5. 5.5 Features of CCPs and Clearing Houses
        6. 5.6 Summary
        7. Notes
      2. CHAPTER 6 Securities Depositories (CSDs and ICSDs)
        1. 6.1 Introduction
        2. 6.2 Historical Context
        3. 6.3 Definitions
        4. 6.4 Central Securities Depositories
        5. 6.5 International Central Securities Depositories
        6. 6.6 Linkages – Exchanges, Clearing Systems and CSDs
        7. 6.7 CSD Associations
        8. 6.8 Summary
        9. Notes
      3. CHAPTER 7 Securities Clearing
        1. 7.1 Introduction
        2. 7.2 Generic Clearing Cycle
        3. 7.3 Trade Capture
        4. 7.4 Trade Enrichment and Validation
        5. 7.5 Regulatory Reporting
        6. 7.6 Confirmation and Affirmation
        7. 7.7 Clearing Instructions
        8. 7.8 Forecasting – Cash
        9. 7.9 Forecasting – Securities
        10. 7.10 Summary
        11. Notes
      4. CHAPTER 8 Settlement and Fails Management
        1. 8.1 Introduction
        2. 8.2 The Different Types of Settlement
        3. 8.3 Delivery versus Payment
        4. 8.4 Free of Payment Settlement
        5. 8.5 Settlement Fails
        6. 8.6 The Move to Shorter Settlement Cycles
        7. 8.7 Summary
        8. Notes
      5. CHAPTER 9 Derivatives Clearing and Settlement
        1. 9.1 Introduction
        2. 9.2 Regulatory Changes
        3. 9.3 Exchange-Traded Derivatives Contracts
        4. 9.4 Cleared OTC Derivatives Contracts
        5. 9.5 Non-Cleared OTC Derivatives Contracts
        6. 9.6 Summary
        7. Notes
    5. PART THREE
      1. CHAPTER 10 Custody and the Custodians
        1. 10.1 Introduction
        2. 10.2 Custody
        3. 10.3 Holding Securities
        4. 10.4 The Custodians
        5. 10.5 Target2Securities (T2S)
        6. 10.6 Summary
        7. Notes
      2. CHAPTER 11 Corporate Actions
        1. 11.1 Introduction
        2. 11.2 Types of Corporate Action Event
        3. 11.3 Participation in Corporate Actions
        4. 11.4 Entitlements, Key Dates and Claims
        5. 11.5 Corporate Action Event Processing
        6. 11.6 Information Flows
        7. 11.7 Corporate Action Risks
        8. 11.8 Industry Initiatives
        9. 11.9 Corporate Governance and Proxy Voting
        10. 11.10 Withholding Tax
        11. 11.11 Impact on Other Departments
        12. 11.12 Summary
        13. Appendix 11.1: Corporate Action Event Type Categories
        14. Appendix 11.2: Voluntary and Mandatory Events for Equities and Bonds
        15. Notes
      3. CHAPTER 12 Securities Financing
        1. 12.1 Introduction
        2. 12.2 Types of Securities Financing
        3. 12.3 The Players and Their Motivations
        4. 12.4 Intermediaries
        5. 12.5 Agreements and Code of Guidance
        6. 12.6 Securities Lending Lifecycle
        7. 12.7 Repurchase Agreement Lifecycle
        8. 12.8 Collateral and Margin
        9. 12.9 Default and Close-Out Provisions
        10. 12.10 Central Counterparty (CCP) Services
        11. 12.11 Summary
        12. Appendix 12.1: Credit Ratings – Long Term
        13. Appendix 12.2: Delivery by Value (DBV) Class List
        14. Appendix 12.3: Technology Vendors
        15. Notes
    6. PART FOUR
      1. CHAPTER 13 Accounting for Securities
        1. 13.1 Introduction
        2. 13.2 The Accounting Equation
        3. 13.3 The Accounting Lifecycle for Securities
        4. 13.4 Gains and Losses
        5. 13.5 The Accounting Lifecycle for Derivatives
        6. 13.6 Summary
        7. Appendix 13.1: Closing Prices for Singapore Equities (SGX)
        8. Notes
      2. CHAPTER 14 Reconciliation
        1. 14.1 Introduction
        2. 14.2 Importance of Reconciliation
        3. 14.3 Types of Reconciliation
        4. 14.4 Automation of Reconciliations
        5. 14.5 Summary
    7. About the Author
    8. Index
    9. End User License Agreement