Overview

This eCourse consists of two modules. Module 1 looks at the different types of stock market index and the construction of these indexes. Stock market indexes serve a number of important functions, such as providing a barometer of equity market performance, acting as benchmarks against which investment performance for portfolio managers is measured, and index investing.

Module 2 provides an overview of the key techniques and instruments, in equity hedging such as diversification and derivatives including equity futures and options. The different types of hedging strategies by hedge funds is also examined.

Objective

On completion of this course, you will be able to:
- Explain how equity indices are put together
- List some companies that measures them
- Illustrate how they calculate increases and decreases in equity markets
- Recognize how indices represent market sentiment and market measures
- Discuss why investors care about how they perform
- Recognize how equity risk can be reduced through the diversification and the use of equity derivatives
- Recognize how hedge funds use hedging techniques to achieve target returns

Content

Module 1: Equity Indices
Topic 1: Overview of Indices
Topic 2: Constructing an Index

Module 2: Equity Hedging
Topic 1: Equity Hedges
Topic 2: Equity Forwards & Futures
Topic 3: Hedge Fund Strategies