1w FinMkt 2024fall v1

Summary

Professor Caleb Kim introduces the course on financial markets and institutions, highlighting the study of financial products and risk management. With a background in economics and extensive experience in risk management, Kim emphasizes the importance of understanding financial market regulations and the OTC market. The course aims to provide a comprehensive understanding of financial markets, institutions, and their roles, with a focus on risk management in the OTC derivatives market. Kim also discusses his involvement in establishing the KW risk-free rate and encourages students to utilize resources like ChatGPT for further insights.

Takeaways

• 😀 Caleb Kim is the instructor for the financial markets course, and students can refer to him by his English name, Caleb.
• 📚 The course aims to provide a comprehensive understanding of financial markets, institutions, and products.
• 🎓 Caleb's educational background includes a bachelor's degree in economics from Korea University and a master's degree from another Korean graduate school during the Asian financial crisis.
• 📈 His professional experience includes risk management roles at NH Investment Securities and as Chief Risk Officer at Numa Korea, focusing on market and credit risk analytics.
• 🌐 Caleb specializes in OTC derivatives and has been involved in establishing the KW risk-free rate, working with the Bank of Korea and other financial institutions.
• 💼 The course will cover various financial markets and institutions, financial systems, regulations, and different types of financial products like money markets, bond markets, and stock markets.
• 📊 A significant part of the course will focus on understanding the operational principles and characteristics of financial markets.
• 🏛️ Compliance with financial regulations is emphasized as a critical aspect of financial business operations.
• 📖 Students are recommended to purchase a textbook for a deeper understanding of financial markets and institutions.
• 🌐 The course includes a study case on a company named Cab planning to start a kimchi business, illustrating the process of raising funds through various financial markets.

Q & A

What is the main focus of the financial market and institution course?

The course aims to provide a fundamental and comprehensive understanding of financial markets, institutions, and their roles and functions. It also covers the essence of financial markets and introduces the characteristics and operational principles of various financial markets.

Who is the instructor for the financial market and institution course?

The instructor is Caleb Kim, who can be referred to as Caleb. His email ID is [email protected], and he encourages students to contact him for any study or exam-related queries.

What educational background does Caleb Kim have?

Caleb Kim has a Bachelor's degree in Economics from Korea University, a Master's degree from a graduate university in Korea, and a Doctoral degree in economics from the University of Foreign Study, where his focus was on swap markets and financial risk management.

What was Caleb Kim's role at Numa Korea?

Caleb Kim served as the Chief Risk Officer at Numa Korea, where he handled market risk, credit risk analytics, and operational risk management.

What is OTC in the context of financial markets?

OTC stands for Over-The-Counter, which refers to financial instruments or securities that are not traded on a centralized exchange but are traded directly between two parties.

What is CSA and how does it relate to OTC derivatives?

CSA stands for Credit Support Annex, which is a part of the ISDA Master Agreement used in OTC derivative transactions. It defines the credit support arrangements, including collateral posting, between the parties involved in the trade.

What is the role of risk-free rate in financial markets?

The risk-free rate is used as a benchmark for pricing financial assets and is considered to have a very low default probability, almost zero. It is often represented by government bond yields.

Why did Caleb Kim participate in the establishment of the KW risk-free rate?

Caleb Kim was involved in the establishment of the KW risk-free rate as part of a working group led by the Bank of Korea, aiming to create a more accurate and reliable benchmark for financial products in the market.

What is the significance of the SOFR in the financial market?

SOFR stands for Secured Overnight Financing Rate and represents the risk-free rate in the USA. It is significant because it is used as a benchmark for various financial products, especially after the 2008 global financial crisis when the traditional risk-free rates were no longer considered reliable.

What are the major topics covered in the financial market and institution course?

The course covers financial markets and institutions, financial systems, financial regulations, money markets, bond markets, stock markets, mortgage markets, and foreign exchange markets.

What is the textbook recommendation for the financial market and institution course?

The textbook recommendation is not explicitly mentioned in the script, but Caleb Kim suggests that students can purchase and read an English version of a textbook that covers the essence of financial markets and institutions.