Equity Masterclass

The Equity course has been designed to provide learners with an understanding of key concepts within the equity markets.

Equity terms are defined, and equity trading is introduced through the equity order book and equity related derivative contracts, such as equity swaps and equity exchange traded funds (ETFs). Equity capital markets are introduced to participants and learners will understand how equity shares are used during mergers and takeovers (M&A) and initial public offerings (IPO).


This course is suitable for anyone new to Equities.

Learning Outcomes

  • Equity definitions and types
  • Comparison to debt
  • Relative risk of Equity
  • The Bloomberg DES screen
  • Equity market capitalisation
  • Prices and volumes on trading screens
  • Beta definitions
  • Where to find a beta calculation
  • How investors use beta
  • Defining the CAPM model
  • Calculating cost of equity capital
  • Using the cost of equity results
  • From cost of equity to cost of firm wide capital
  • Calculation of WACC
  • Uses of WACC
  • What makes an attractive long candidate
  • What a long position looks like
  • Profit and loss from a long position
  • What makes an attractive short candidate
  • What a short position looks like
  • Profit and loss from a short position
  • What makes a good market
  • The major equity exchanges
  • The bid/ ask spread
  • The structure of the electronic order book
  • Types of equity orders
  • Dealing with market orders
  • Defining a limit order
  • Executing limit orders
  • Comparing limit orders and market orders
  • Introduction to algo orders
  • VWAP and TWAP
  • VWAP calculations
  • Describing an equity swap
  • Terms of an equity swap
  • Example cash flows in an equity swap
  • Describe an open-ended investment company
  • Advantages of investing via an ETF
  • Short description of the ETF creation process
  • What is an equity index?
  • Uses of an equity index
  • Simple calculation of equity index
  • What is an IPO?
  • Advantages and disadvantages to IPO
  • The IPO process
  • What is a merger/ takeover?
  • The merger process
  • Valuing a merger deal
  • Definition of pre-emptive rights
  • Why companies launch rights issues
  • Balance sheets and rights issues
  • The rights announcement
  • Theoretical ex-rights price (TERP)
  • Investor decisions
  • PB services
  • Bank/ client relationship
  • PB risk
  • The stock loan function
  • How to borrow stock
  • Short selling considerations

Course Content

Equity Fundamentals

Unit 1 – What is Equity?

Unit 2 – Equity terms

Equity Beta

Unit 3 – What is Beta?

Unit 4 – Beta and the CAPM

Unit 5 – From CAPM To WACC

Trading Equity

Unit 6 – Long equity

Unit 7 – Short equity

Unit 8 – Equity order book

Unit 9 – Market orders

Unit 10 – Limit orders

Unit 11 – Other equity orders

Equity Products

Unit 12 – Equity swaps

Unit 13 – Equity ETFS

Equity Indices

Unit 14 – Equity index

Equity Capital Markets

Unit 15 – IPOs

Unit 16 – Equity M&A

Unit 17 – Rights issues 1

Unit 18 – Rights issues 2

Equity Prime Brokerage

Unit 19 – Equity PB

Unit 20 – Short selling

This Course Includes

  • Learn: 20 micro-learning on-demand videos
  • Check: 20 knowledge checks to validate understanding
  • Apply: 20 hands-on practical exercises and projects
  • Requirements: Access to a computer with an internet connection
  • Accessibility: Access on PC, mobile or TV
  • Certification: Certificate of completion with CPD record


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