Course outline: Understanding Equities

In-house Training

Capital Markets & Derivatives Training specialise in developing and delivering bespoke in-house training courses and programmes. This sample course outlines the content and structure of a typical course.

Objective: This introductory course enables delegates with little or no prior knowledge of equity instruments to gain a good understanding of the various types of equity, why and how they are issued by companies, and a short introduction to equity pricing.
Course aims:
  • Identify the different types of equity security
  • Understand the difference between equity and debt
  • Examine how securities are issued and traded
  • Review the main valuation principles

Types of Equity

This section provides an overview of the different types of equity, and to contrast it with debt.

  • Characteristics and types of equity capital
    • Ordinary shares
    • preference shares
    • warrants
  • Equity v debt compared
  • Returns to shareholders: the role of the dividend and dividend policy

The Primary Markets

This section covers the issuance of equity in the primary markets, contrasting the methods available.

  • Initial Public Offerings (IPO's)
    • underwriting v public/private placements
  • Secondary distributions & corporate actions
    • rights issues
    • share buy-backs

The Secondary Markets

This section looks at how shares are traded in the secondary markets and the different trading platforms.

  • How shares are traded
    • quote driven v order driven markets
    • order types
  • Market indices

Prima on Equity Valuation

This section introduces the basic approaches to equity valuation and looks at the merits of each of the methods.

  • Concepts of market efficiency
  • Relative valuation techniques
    • price/earnings analysis
    • forecasting earnings
  • Dividend valuation model
  • Discounted cash flow approaches

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