Main Topics of Study:

The Financial Services Act (1986)

• Aims of the Act
• Authorisation & Regulation of Financial Institutions & Advisors
• Regulatory Organisations & Penalties Under the Act
• Current Proposals for Improving the Regulatory System

The Analysis of Share Returns & Yields:

• Profit & Risk Assessment
• Return on Shareholders’ Capital
• Understanding the Balance Sheet & Cash Flow Statement
• Basic Ratios Used to Analyse a Company’s solvency
• The Concept of ‘Gearing’
• Gearing Ratios
• Profitability Ratios
• Technical Analysis of a Share’s Performance
• The Use of Charts

Indexes & Their Use:

• The FTSE Index
• Other Indexes
• The Concept of Efficient Market Hypothesis

The Concept of Options:

• Types Including Traded Options
• Options as a Process of Hedging
• Financial Futures (LIFFE)
• Warrants

New Issues:

• Procedures Including ‘Offer for Sale’ by Fixed Price, or by Tender
• Private Placings
• Costs & Timing of New Issues
• Underwriting
• Allotment Procedures
• Stagging of New Issues
• Rights Issues
• Scrip Issues

The Stock Exchange Dealing System:

• The System Before October 1986 (Big Bang)
• The Need for Change
• The ‘New’ System - Broker Dealers, Market Makers & Their Respective Roles in the Equity Market
• Computerised Dealing - SEAQ & TOPIC
• The Operation of the Gilts Market - Bank of England
• Inter-Dealer Brokers
• Broker Dealers etc.
• Investment-Process & Analysis

The Settlement Procedure:

• The New ‘Account’ System
• Contract Note
• Stamp Duty
• Transfer of Securities (Talisman)
• Certificates & Their Future ‘Abolition’

Reading List

Main Text:
How to Read the Financial Pages by Michael Brett (Random House Business Books)

Alternative Texts and Further Reading:
Financial Services & Regulations (BPP)
Lump Sum Solutions - A Practical Guide to Lump Sum Investments - R Anderson (Investor’s Portfolio)
Financial Services - J Eve & I Leeman (OUP)