Global Capital Markets

Hyderabad, 16th March 2022: Institute of Management Technology (IMT), Hyderabad hosted the eighth session of the second edition of the Global Immersion Program (GIP) on 16th March 2022. The speaker for this session was Dr. Ata Assaf, Professor, University of Balamand, Lebanon, who talked about Global Capital Markets. An official welcome address was given by Srividya Racharla, a first-year PGDM student.

Dr. Assaf started his presentation by asking what is unique about international finance or the global market and then gave a brief explanation. The speaker used the example of fluctuating global oil prices to explain this. He also emphasized the emergence of global financial markets and people interested in the same. The first part of the session included introductory discussions about trade liberalization, privatization, and various financial innovations such as – Currency futures and options, multi-currency bonds, cross-border stock listings, and international mutual funds.

The speaker concisely explained a Short Sale as a sale in which the seller does not actually own the security sold and further explained how the investor benefits from it. Dr. Ata Assaf explained the classification of the securities in basic types and major sub-types; he highlighted that there are three basic types of securities- interest-bearing, equities, and derivatives. The speaker further explained by giving an example on fixed-income securities price quotation.

Dr. Ata Assaf gave an elaborate explanation on the world's bond market and threw some light on how the total market value of the world's bond market is 50% larger than the world's equity market. He further told about the difference between the Bearer Bonds and the Registered Bonds. He highlighted the colorful names of the foreign bonds by giving examples of Yankee Bonds, Samurai Bonds, and Bulldogs. The speaker further accentuated that a global bond is an extensive bond offered by a single borrower simultaneously sold in North America, Europe, and Asia.

The speaker mentioned the different types of instruments used in global capital markets and explained the dual currency bonds in which principle is in one currency whereas interest paid is in some other currency. He further explained Straight Fixed Rate Debt and Floating Rate Notes. Dr. Assaf further threw some light on Equity Related Bonds and described convertibles and bonds with equity warrants. The speaker also shared websites of some reputed organizations that can determine the international bond market credit ratings.

Dr. Assaf explained the difference between common and preferred stocks. He mentioned that in international Equity Markets, over 90% of the total market capitalization of the world's equity market is accounted for by the market capitalization of the developed world.

The speaker also talked about stock funds, long-term funds, investment companies, fund types, futures, and mutual funds. The session was followed by a brief question and answer session where the speaker answered some students' queries. The students expressed their sincerest gratitude and thanked the speaker for an insightful session.

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