Course Objectives

  • To equip the students take potential concrete decisions on sourcing the funds and also on investing the funds.
  • To expose them tussle with the gravity of Risk in financial markets.

UNIT I Indian Financial System

Overview of Indian Financial system – Financial Institutions – Financial Instruments – Financial Markets – Financial Services – Digitalization in Financial system – pros and cons – Financial Sector reforms

UNIT II Indian Banking System

Overview of Indian Banking System, Functions of banks, modern day banking – key Acts governing the functioning of Indian banking system – Functions and Role of RBI - RBI Act 1934, Negotiable Instruments Act 1881, Banking Regulations Act, 1948 – Role of Banks in Indian Financial system – NBFCs

UNIT III Equity, Bond and Money Market

Equity market – primary and secondary market – SEBI rules for IPO and listing. Bond market –types. Money market securities – globalization of money markets - background of money market - risk and valuation.

UNIT IV Foreign Exchange Market

Foreign Exchange Markets – Spot Prices and Forward Prices – Factors influencing Exchange rates – The effects of Exchange rates in Foreign Trade – Tools for hedging against Exchange rate variations – Forward, Futures and Currency options – FEMA – Exchange Rate Theories

UNIT V Derivatives Market

Derivatives – Definition – Types – Forward – Futures – Options – Swaps – Differences between Cash and Future Markets – Types of Traders – OTC and Exchange Traded Securities – Types of Settlement – Uses and Advantages of Derivatives – Risks in Derivatives – Derivatives market in India.

Learning Resources

  • Padmalatha Suresh and Justin Paul, “Management of Banking and Financial Services”, Pearson, Delhi, 2012.
  • Prasannachandra, Investment analysis and Portfolio Management, Tata McGraw Hill, 4th edition 2012.
  • Keith Redhead, ‘Financial Derivatives – An Introduction to Futures, Forwards, Options and SWAPs’ – PHI Learning, 2011.
  • Jeff Madura, International Corporate Finance, Cengage Learning, 9th Edition, 2011.
  • M.Y Khan, Indian Financial System, Tata McGraw Hill, 6th Edition, 2011