Debt & Money Markets: Concepts, Instruments, Risks and Derivatives

3 – 4 hours per week

Course Information

Course Length     : 5 weeks
Estimated Effort  : 3 – 4 hrs per week

Course Overview

This Finance course by IIMBx explores the structure and functioning of money markets and debt markets. It also examines the manifestation and impact of interest rate risks in these markets as well as the means of managing and mitigating the same.

Along with covering the key concepts related to Debt and Money Markets such as time value of money, bond pricing and valuation, the MOOC also examines the macro-economic variables that impact global financial markets, particularly debt markets. Besides these, in this course, the learners will also learn tools and techniques to manage the heightened level of interest rate risks.

This course is also part of IIMBx’s Professional Certificate program ‘Risk Management in Banking and Financial Markets’

Professor PC Narayan

Course Instructor Finance and Accounting Indian Institute of Management Bangalore (IIMB).

Course Syllabus

Week 1: Money Market
  • Overview and Planner for Week 1
  • Overview of Money and Debt Markets
  • Call Money Market
  • Treasury Bills Market
  • REPO Market
  • CBLO Market
  • Commercial Paper Market
  • Market for Certificate of Deposits
  • Banker’s Acceptance
  • Pricing Money Market Instruments
  • Summary and Additional Readings

Quiz Time: Weekly Graded Assessment 1 (Only for Verified Track Learners)

Week 2: Debt Market
  • Overview and Planner for Week 2
  • Debt Markets: An Overview
  • Recap of Time Value of Money
  • Yield and Yield-to-Maturity
  • Bond Valuation
  • Bond Market: An Overview
  • Government Securities Market
  • Corporate Bond Market
  • Mortgages Market
  • Characteristics of Mortgage
  • Special Types of Mortgage
  • Mortgage Payments and Amortization
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 2 (Only for Verified Track Learners)
Week 3: Interest Rate Risks
  • Overview and Planner for Week 3
  • Risks in Investing in Corporate Bond Markets
  • Overview of Interest Rate Risk
  • Measuring and Managing IRR: Repricing Gap Analysis
  • Macaulay Duration, Modified Duration and Convexity
  • Measuring and Managing IRR: Duration Gap Analysis
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 3 (Only for Verified Track Learners)
Week 4: Interest Rate Derivatives
  • Overview and Planner for Week 4
  • Risks Embedded in Derivatives
  • Interest Rate Derivatives
  • Hedging Using Interest Rate Futures
  • Interest Rate Swaps
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 4 (Only for Verified Track Learners)
Week 5: Final Exam for the Course
  • Final Exam Instructions
  • Final Exam: FAQ
  • Final Exam: Knowledge Check (Only for Verified Track Learners)

Upon completing the course, learners will be able to explain the following concepts with clarity:
• Money markets or short-term financial markets
• The financial instruments traded in money markets as well as their underlying market mechanisms
• The theories governing debt markets
• The nature, composition, structure, and functioning of debt markets
• The risks in investing in the instruments traded in debt markets
• The pricing and trading aspects as well as the regulatory and market mechanisms governing money markets

Executives, students pursuing post graduate and anyone who wants to upskill themselves in the field of Economics and Finance.


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