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IBF614 Fixed-Income Securities

Fixed-income securities include bonds and structured products (e.g. mortgage-backed securities and asset-backed securities) that promise interest payments and repayment of the amount borrowed. They also extend to all securities whose valuation and hedging are related to interest rates. In the sale of those securities by issuers to investors, credit ratings are critical in the assessment of the credit risk associated with such securities.

The course will cover the basics of various types of fixed-income securities and securitization products, as well as the terminologies and methodologies of credit rating of corporates, financial institutions and securitizations. These concepts and tools are useful to practitioners who want to use these securities, whether for investing, hedging, market-making, or speculating.

Pre-requisite: IBF505 Investment Theory and Applications or equivalent