Financial Markets and Instruments. January-February 2007

Syllabus

Lecture slides: 1a introduction, 1b interest rates, 2 money, bond and stock markets, 3 derivatives, 4 primary and secondary markets, 5 commercial and investment banks, 6 mutual funds, 7 regulation and trends

Supplementary materials for the projects (IPOs, ADRs, derivatives, funds, etc.)

 

Mini-cases

·        Class 1: Grameen and micro-financing. Why did the bank and its founder receive a 2006 Nobel peace prize?

·        Class 2: Junk bonds. Is it an example of financial market success or failure?

·        Class 3: Weather derivatives. Are derivatives the “financial weapon of mass destruction” as Warren Buffet used to say?

·        Class 4: IPO in London. What does it take to get to London?

·        Class 7: Bank run. How to prevent panic?

 

Supplementary resources and readings

·        Mishkin&Eakins accompanying website containing web links, mini-cases, web exercises, and quizzes for each chapter

·        Wikipedia: everything about finance, financial markets, and financial regulation

o       Financial instruments: money and securities, stocks and bonds, structured products

o       Financial services industry: commercial and investment banks, derivatives, mutual / pension / hedge / exchange-traded funds

·        Class 1: financial markets statistics and islam finance

·        Class 1: Rajan and Zingales, 2001, Financial systems, industrial structure and growth, Oxford Review of Economic Policy 17(4), 467-482. A survey of recent empirical evidence on the impact of financial system on economic growth.

·        Class 1: Computation of a risk-free rate as a yield to maturity of OFZ bond

·        Class 2: bond market statistics

·        Class 2: the chapter on international bond markets, incl. extensive description of Euromarkets

·        Classes 2-3: Goriaev and Zabotkin, 2006, Risks of investing in the Russian stock market: Lessons of the first decade, Emerging Markets Review 7(4), 380-397. Analysis of the risk factors in the Russian stock market.

·        Class 3: derivatives statistics, weather derivatives

·        Class 3: MICEX presentation on the derivatives in Russia

·        Classes 2-5: BIS Quarterly Review December 2006, including statistics on banks, securities, and derivatives

·        Classes 3- 4: the ADR information by the Bank of New York, including 2005 DR Yearbook

·        Class 4: Roell, 1996, “The decision to go public: An overview” European Economic Review 40, 1071-1081. A survey of firms’ motives to do an IPO and country specifics.

·        Class 4: secondary markets in Russia and abroad

·        Class 5: Russia’s banking system

·        Class 5: reports on US banks by Fed and on Russian banks by CBRF

·        Class 5: European Wealth and Private Banking Industry Survey 2005

·        Class 6: mutual funds in Russia and abroad

·        Class 6: Investment company institute and 2006 factbook, extensive information about the US mutual fund industry

·        Class 7: conflicts of interest and regulation

 

Data sources

·        Cbonds: Russian local bonds and Eurobonds

 

Exchanges

·        ÌÌÂÁ

·        ÐÒÑ

·        Brussels Stock Exchange

·        Euronext

·        Kazakhstan Stock Exchange

·        NASDAQ

·        New York Stock Exchange

·        Paris Stock Exchange

·        Toronto Stock Exchange

 

Regulators

·        Áàíê Ðîññèè

·        Ôåäåðàëüíàÿ ñëóæáà ïî ôèíàíñîâûì ðûíêàì

·        Ãîñóäàðñòâåííàÿ êîðïîðàöèÿ 'Àãåíòñòâî ïî ñòðàõîâàíèþ âêëàäîâ'

·        Board of Governors of the Federal Reserve System

·        US Securities and Exchange Commission

·        Federal Deposit Insurance Corporation

·        European Central Bank

 

International financial institutions

·        International Monetary Fund

·        World Bank

·        International Finance Corporation

·        European Bank for Reconstruction and Development

·        Bank for International Settlements