and inflation together are perhaps the most significant
macroeconomic variables that impact global financial markets,
particularly money and debt markets. More so, given the free flow
of capital across countries and the consequential emergence
of globally interconnected financial systems. As a result, managing price
volatility and interest rate risks embedded in instruments traded
in the money and debt markets have become exponentially more complex. Hello. My name is PD Narayan. I have been with the Indian
Institute of Management Bangalore for the last 14 years engaged
in teaching, research, and consulting primarily in the
area of banking and finance. In this course titled
Money & Debt Markets– Concepts, Instruments, Risks,
and Derivatives, we will examine, in detail, money markets or short-term
financial markets such as call money markets, T-bill markets,
repo markets, et cetera that make up the ecosystem
to effectively manage money supply, that is
liquidity, and ensure stability of the financial
system in the short-term. The second part of
this course, we’ll look at debt markets, the underlying
theories such as time value of money, bond pricing, bond valuation, as
well as the structure and functioning of debt markets such as the corporate
bond market, the government securities market, or the treasury bond market,
as it is called in some countries, and the mortgages market. We will also look at various
types of interest rate risks that are embedded in
the instruments traded in those markets and the
tools and the techniques to manage those risks such
as repricing models, duration and convexity, duration gap analysis,
et cetera, as well as interest rate derivative instruments such as
interest rate futures, interest rate swaps, interest rate
options, and their role in not only helping institutions
to hedge against those risks, but also to speculate and make some
additional profits where possible. So join me in this interesting
journey to unravel the structure and functioning of money markets,
debt markets, and the manifestations and impact of interest rate
risks on those markets. How are they managed? And to what extent
can they be mitigated? I look forward to seeing
you in this course. [MUSIC PLAYING]