Equity Stock Markets: Concepts, Instruments, Risks and Derivatives

3 – 4 hours per week

Course Information

Course Length     : 6 weeks
Estimated Effort  : 3 – 4 hrs per week

Course Overview

This IIMBx course is designed for students and professionals who wish to understand the various nuances of Equity Stock Markets. The course explores the structure and functioning of Equity Stock Markets, underlying theories, as well as the means to identify, assess and manage the various levels of risks involved, while also uncovering the role of derivative instruments in hedging those risks.

Equity stock markets are perhaps the most vibrant and ‘visible’ of all financial markets around the world under the broad spectrum of participants and the volume and value of transactions traded in these markets. Given that dominant presence, assessing and managing risks in equity stock markets have also become increasingly sophisticated over the years, thanks to several theories such as portfolio theory, CAPM, sharp ratio, etc. that have evolved and matured over the years.

This course will address in great detail those theories on how risks are managed/mitigated in equity stock markets around the world. This course will also address the structure and functioning of private equity markets as well as provide an overview of a related topic, venture capital financing.

This course is 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: Overview of Equity Stock Market
  • Overview and Planner for Week 1
  • Financial Markets: An Overview 
  • Equity Stock Market: An Overview
  • Estimating the Price of Equity Stocks
  • Equity Stock Market: Market Mechanism
  • Equity Stock Market: Indices and Regulatory Mechanism
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 1
Week 2: Underlying Theories Governing Equity Stock Markets
  • Overview and Planner for Week 2
  • Fundamental Analysis
  • Technical Analysis
  • Fundamental vs. Technical Analysis
  • Moving Averages
  • Dow Theory
  • Elliot Wave Theory
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 2
Week 3: Equity Risk and Portfolio Theories
  • Overview and Planner for Week 3
  • Equity Risk: An Overview
  • Introduction to Portfolio Theory
  • Portfolio Theory – CAL and CML
  • Portfolio Theory – SML and CAPM
  • Evaluating Equity Portfolio using Sharpe Ratio, Treynor Ratio and Jensen’s Alpha
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 3
Week 4: Hedging Using Derivatives in Equity Stock Markets
  • Overview and Planner for Week 4
  • Derivatives in Equity Market
  • Hedging Using Stock Futures
  • Hedging Using Index Futures
  • Hedging Using a Single Option
  • Multiple Options and Trading Strategies
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 4
Week 5: Private Equity Markets and Venture Capital
  • Overview and Planner for Week 5
  • VaR (Value at Risk)
  • Computing and Enforcing Margins
  • Private Equity Market
  • Venture Capital
  • Summary and Additional Readings
  • Quiz Time: Weekly Graded Assessment 5
Week 6: Final Exam for the Course
  • Final Exam Instructions
  • Final Exam: FAQ
  • Final Exam: Knowledge Check

By the end of this course, learners should be able:

  • To explain the structure and functioning of equity stock markets
  • To summarise the theories governing equity stock markets
  • To examine the market and regulatory mechanisms governing equity stock markets

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

Viraj R Pawar

Thank you for the wonderful explanation about Equity Stock Markets. I’m now clear with all my basics about it.

Kunj Shah

SIr, only one word awesome, it was great to hear him making us understand the most difficult topics in simplest possible way. just a small request to keep changing the outfit so it doesn’t seem monotonous.

Priya Mahajan

Overall course was good. I really learned a lot from this . if you can include more subjective questions then it will become more interesting.

This will close in 50 seconds