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NATIO ONAL STOCK EXCHA S ANGE OF INDIA LIMITE A ED

Depart rtment : SB BU-Educatio on NCFM COURS OUTLINE M SE

Interes Rate Deri st ivatives: A Beginner's Module s

Interest Ra ates and Ti ime Value O Money Of Introduction Factors affecting the level of int n; a e terest rate; Impact and classification of intere d est rate and Pr resent value Future va e, alue and Dis scount facto or. Money and Fixed Inc d come Marke ets Money mar rkets and Fixed income markets. e Governme Bonds ent Introduction to and Ch n haracteristic of Bonds; Concept of yield; Rela cs o ationship be etween bon nd price and in nterest rate; Repo and cost of funding and other bond te erminology. Interest Ra Derivatives ate OTC Deriva atives; Exch hange trade contracts and key te ed s erminology of futures market. m Interest Ra Futures (IRF) in In ate s ndia Interest rate futures; Rationale; C e R Contract spe ecifications; Settlement and Risk Managemen t M nt. An Explanation of Ke Concept in IRF ey ts Why a notio onal bond is being use as underlying; Conversion facto Invoice price; Cheapest s ed or; p to deliver b bond; Bond basis. Applications and Tra ading of Int terest Rate Futures e Participants in the IRF market; He s F edging appl lications of interest rate derivative Speculat e es; tion and Arbitra strategy age y.

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