Bond Principles For Financial Advisors and Investors

BOND ONLINE COURSE : FPI 2.5CPD POINTS: IOBSA 5CPD POINTS
Course objective:
Bonds complement growth assets in an investment portfolio to create an optimal risk adjusted return profile in most market conditions and risk scenarios. This course is designed to create a better general understanding of fixed interest investments and their application areas. Opposing issues around this asset class will also be examined.
The objective is to equip attendees with the basic knowledge of fixed interest instruments as an important tool in addressing client’s risk, diversification and income needs. The short course format excludes any comprehensive study on the subject matter and the content is a conceptual overview.
Course content:
1. Recap: What is a bond? The relationship between price and yield as an underlying principle.
2. Understanding of the three main types of Bonds with respect to their return and risk profiles. This is achieved via a conceptual discussion of the various cash flows (no detail financial calculations).

• Vanilla Bonds
• Floating rate notes and shorter money market investments
• Inflation linked bonds

3. Knowledge application by comparing the respective bond risk and return profiles to one another, as well as to equity investments. The comparison will be explained via the differences in risk and cash flows to create a better understanding of bond application areas.
4. Various market conditions and their theoretical influence on bond returns and performance.
5. Risk factors unique to bonds, i.e. duration, credit risk, basis points, opportunity cost. This will be a short overview
6. Practical factors related to bond investing

• Market access and tradability

• Bond funds and costs