FIA Certification Prep Course
Schedule: TBA
*The class is offered via Acrobat Adobe webinar
Cost: Members: Costs for the class are $995 for the two days, or $695 for either day independently. If you are unable to take both classes at the same time the $995 rate applies so long as both classes are taken within a six month period.
Course Instructor: Tee Williams is a well-known consultant and Principal of Tee Williams Associates. Tee is an expert on market data operations and strategy, helping exchanges, vendors and financial institutions with the information technology. He wrote "Death of 1000 cuts: Strategic Peril and Potential in the New Market Data Industry."
This two-day class is designed to get someone new to the industry up to speed to take the FIA Certification Exam, but if you only need to brush-up on issues related to data then the second day is designed for you. Here is how it works:
DAY ONE
Overview and Background: Financial information fits in the context of the industry it serves and the markets that use data. We begin with broad definitions to provide context for the remainder of the class.
Entities: A number of different functional entities comprise the financial markets. We use
the term functional entities because thirty years of consolidation and relaxed regulations mean that most of the functions are departments within holding companies rather than independent organizations. We will introduce the metaphor of the Street and define the roles of participating entities.
Break
Instruments: Instruments that are the basis for investments and trading include cash instruments (equities, fixed income or fixed interest, foreign exchange, and cash commodities), derivative instruments (futures, options and complex derivatives), and packaged instruments (mutual funds, unit trusts and exchange-traded funds). We will examine the characteristics of each asset class.
The Trading Process: There are eight primary steps in the trading process. These steps both consume and produce the information that is the primary purpose of the market data process. We will examine the steps and also consider the different trading venues (i.e., exchanges, ECNs, MTFs, "dark pools" and dealers) that create the executions.
Lunch
The Accounting Process: Much of the information that we define as market and reference data is consumed in valuing holdings, processing transactions and handling corporate actions. These processes can be complex because of the variety of instruments that are involved and
the many different attributes they may have. However, at the core trade and
investment accounting is a straightforward process and we will examine how it works.
Risk Management: The events of 2007 and 2008 have shown the need for risk management. Data plays a pivotal role in controlling risk. We will examine the issues related to risk and data.
Break
Global Markets:The current market is becoming increasingly globalized. This has a huge impact on trading and data management. We will examine the impact of a twenty-four hour global marketplace.
Compliance and Regulation: Financial information operates in a world that is increasingly regulated. To satisfy those regulations we must understand the basis of regulations and know what is required to ensure compliance. We will examine the important regulations that apply to information and recent changes.
DAY TWO
Overview and Background: We begin with a brief review of the background covered in Day One.
- Entities and functions
- Instruments
- Trading and the role of markets
- Accounting and how information is used
- Governmental authorities
We then explore the major issues related to data for the FIA test.
Usage: The way users employ data has changed dramatically, and usage continues to
evolve. We examine the processes of the primary and secondary markets and how
each step in these processes both use and produce information. We will look at
current, evolving patterns of usage, and the issues these changing patterns create.
- Participants
- Business functions
- Job functions
- Primary and secondary market processes
- Issues - Usage
Break
Content: We define three major categories of data: process data, reference data, and market
data. (Most definitions ignore data that is produced by processes and within entities
because it is not furnished by vendors.) Moreover, in addition to data types or
categories, data can be described by its characteristics, by distribution issues and by
instrument types.
- Types, attributes and asset-specific features
- Sources and uses
- Standards - Business
- Delivery and display
Vendors: Vendors specialize by service (applications, data and networks), by instrument types and by function (front, middle and backoffice.) We will examine major vendors and their most important products.
- Data creators and vendors
Lunch
Ownership: Financial information is owned. It is not sold, but licensed for use. This principle is necessary to understand the data business. We examine the principles of data ownership and usage in terms of the intellectual property rights of the parties.
- Intellectual property
- Contracts
- Commercials - Ownership
- Issues - Ownership
Administration, Management and Pricing: Since data is owned by its creators and licensed for use there are complex procedures for entitling, tracking, reporting, and verifying proper usage. Content owners and vendors impose policies on users that govern these procedures. Information pricing is based on units and defined products. Units of count seek to isolate easily measured elements that can be tied to usage.
- Data administration overview
- Data management and control - Data creators
- Data management and control - Vendors
- Data management and control - Users
- Commercials - Entitlements, inventory, reporting, and audits
- Issues - Administration and management
Delivery: Real-time data is currently delivered to user workstations or in feeds. Data is consumed by users viewing display devices and by applications. However, the dimension of timeliness-low latency versus normal latency-is beginning to divide data delivery into distinct business-requirements categories. We will examine these categories, and we will investigate the technology issues associated with data creation, distribution, storage and management, and consumption.
- Distribution
- Display
- Datafeeds
- Architecture
- Issues - Delivery
Issues: Both Europe and North America have had enacted significant pieces of legislation in
response the desired changes in market structure (RegNMS and MiFID) as well as reactions
to the financial crisis of 2007-2009 (Dodd-Frank and proposed changes in Europe). Moreover, changes in trading are causing major redefinition of the requirements for data. We will examine these issues:
- Reg-NMS
- MiFID
- Dodd-Frank
- European changes
- Regulatory concerns
- The conversion to automated trading
- High-frequency trading
A discussion of the FIA Certification Test: We are beginning to get feedback from those who have taken the test. We will entertain questions and provide insights into how the test seems to be structured for all who wish to participate.