Module_2.ppt - Module 2 Learning Goals To understand the...

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Module 2
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Learning Goals To understand the workings of financial markets To understand the importance of market orders, and how they work. To understand the importance of the law and the regulations To interpret any financial market according to its architecture. To understand the importance of the different trading systems and understand perfectly how they work. To analyze the differences between different forms of trading: Auction markets, Continuous auction markets (driven by orders) and Price-driven markets. 2
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Context You have passed the selection process of the CarlosIII banking organisation and they have hired you to work in the financial markets consultancy department. On your first day of work, the Head of Markets tells you that your first job will be to familiarize yourself with the financial markets: their operation, classification and importance, and an understanding of electronic formats that allow them to operate. 3
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Overview Introduction Types of market The competition between markets The Directive on Investment Services (MiFID) 4
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Continuous assessment: The group must present an executive report, maximum 2 pages long. In it they will explain the operation of the chosen market. What type of market it is, who can carry out orders etc. The only restriction is that you may not choose any of the Spanish markets. 5
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Introduction
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7 Introduction A financial market may be a physical location or otherwise (electronic) where instruments are exchanged. Today the vast majority of markets are electronic. Reasons Price efficiency: Definition? This efficiency would be more difficult of achieve if the markets opened every day for a few minutes, since company information is produced continually throughout the day. DOES THIS MAKE SENSE TODAY WITH THE FALL IN PRICES? WERE THE MARKETS EFFICIENT?
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8
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9 Introduction A financial market may be a physical location or otherwise (electronic) where instruments are exchanged. Today the vast majority of markets are electronic. Reasons Price efficiency: Definition? This efficiency would be more difficult of achieve if the markets opened every day for a few minutes, since company information is produced continually throughout the day. DOES THIS MAKE SENSE TODAY WITH THE FALL IN PRICES? WERE THE MARKETS EFFICIENT? Ease and equality of access: the fact that the markets are electronic facilitates connection by all operators.
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Module_2.ppt - Module 2 Learning Goals To understand the...

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