The objectives of this seminar are to give you a thorough introduction to equity markets and instruments, and a good understanding of how equity investment strategies can be formulated and implemented in practice.
We start with a general introduction to equity instruments, and we explain how shares and related instruments are traded and settled in the primary and secondary markets. We then look at the regional and sector-specific factors that commonly affect share value, and we explain how factor models can be used to quantify the effects of (changes in) such factors as growth, inflation, commodity prices.
Further, we present and thoroughly explain methods for fundamental stock analysis, covering the entire valuation process through the final investment recommendation or decision. We also explain how information about an individual firm's financial health, profitability, growth prospects etc. can be extracted from the firm's financial statements and combined into useful ratios and multiples. We discuss possible shortcomings of such ratios, including the problems arising from the use of different accounting principles and "financial shenanigans".
We devote a significant part of the seminar to explain how the results from equity analysis can be used for the design of investment strategies that are consistent with investors' views, preferences and constraints. We present quantitative tools for portfolio management and we explain how diversified/optimized portfolios can be constructed. We also present and explain the benchmark timing and core-satellite approaches to portfolio construction. Further, we present and discuss relative value strategies such as Value/Growth, Regional/Sector, Long only/ Long and Short etc.
Finally, we explain how these investments and portfolio strategies can be implemented in practice, using cash instruments, derivatives and structured products. We explain in detail how synthetic indexation strategies, CPPI, leveraged investment strategies etc. can be designed and implemented, and we illustrate with practical examples and case studies.