Funds, Hedge Funds and Asset Managers

Duration: 2 Days ・ CPD Points: 16 CPD Points ・ Level: Intermediate

Enhance your credit analysis proficiency with our two-day Funds, Hedge Funds, and Asset Managers course, available live online or in person, offering a structured analytical framework to evaluate the creditworthiness within the dynamic world of fund management.

Delivery Method Classroom
Location London
Dates 22-23 Apr 25
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Course Details

The overall goal of this course is to provide participants with a structured analytic framework for the credit analysis of retail funds, alternative / hedge funds and asset managers.

Key Learning Outcomes:

  • Assess the risk profile of a fund’s structure, investment strategy, leverage and liquidity
  • Understand financial criteria to benchmark the performance and risk profile of a fund or hedge fund
  • Identify key macroeconomic and market drivers in the funds sector and relevant current and proposed regulation
  • Identify the due diligence considerations for evaluating a fund manager
  • Early warning signals of hedge fund manager problems
  • Evaluate the structural risks of exposures to funds

Course Content

Analytic Overview

Introduction to a structured approach to fund and fund manager analysis.

  • Purpose of transaction and sources of payback: Who is the counterparty? What assets or derivatives are being financed? How will the transaction be settled or the repaid at maturity?
  • Risk analysis approach: Operating environment, financial fundamentals and management
  • Exercise: Purpose and payback funds and fund managers
  • Information sources: Prospectus, financial and portfolio statements
  • Fund ratings: Rating agencies, Morningstar and other ratings

Orientation

Differentiates funds types encountered in the industry by their structural, legal and jurisdictional features.

  • Structure and legal status of funds and managed accounts; partnerships, corporations, segregated accounts 
  • Types of fund, financial products used and risk profile – mutual funds (incl. UCITS, ICVCs, FCPs, OIECs and SICAVs), managed accounts, tracker and exchange traded funds (ETFs), smart beta, umbrellas, closed-ended funds and investment trusts, REITs, private equity, fund of funds, master feeders, hedge funds, pension funds

Investment Strategies

Differentiate the investment and trading practices and risk profile of different retail and alternative / hedge fund strategies.

  • Investment strategies: Risk profile of strategy, policies, practices and restrictions
  • Goals: Absolute vs. benchmarked returns; Alpha vs. beta; Minimising correlations
  • Fee structures: Upfront and performance; high water marks
  • Techniques to optimise risk adjusted returns: Leverage, derivatives and short-selling
  • Traditional strategies: Fixed income (money market, bond), equity and growth, value and Multi-asset strategies
  • Exercise: Identifying risk profiles and trading approach of different alternative strategies
  • Sources of bias in indices
  • Uncorrelated returns, volatility vs. return, drawdown statistics
  • Risk and return characteristics of alternative strategies:
  • Directional vs. Relative Value strategies

Operating Environment

Review macro, competitive and regulatory drivers of the retail and alternative/hedge-fund sectors.

Macro and competitive drivers

  • Competitive drivers in the industry 

Regulation and supervision

  • Regulation and supervision by region
  • Mutual funds – investment and leverage limits, disclosure
  • Fund manager regulation; capital adequacy, licensing, business practices
  • Money Market fund reform in EU and US: CNAV, VNAV, LVNAV
  • Exercise: Assessing regulatory framework: offshore registrations, listings, fund manager domicile
  • Impact of regulation:
  • Proposed EU Investment Firms Regulation (IFR) and NBNI G-SIFI systemic risk proposals

Financial Fundamentals

Benchmark key performance indicators for different types of fund to identify both strong and weak performers.

  • "S": Size – reviewing size, diversification and market position of fund
  • "M": Market risk – volatility measures e.g. standard deviation, VaR
  • "A": Asset quality – liquidity and valuation of assets, haircuts
  • "L": Liquidity – managing redemption risk 
  • "L": Leverage – use of financial and derivative/synthetic leverage, UCITS leverage restrictions
  • "P": Performance – bench marking performance. NAV measures, information, Sortino and Sharpe ratios
  • Case study: Assessing the financial strength a liquid alternative fund using SMALLP approach

Early Warning Signals

Quantitative and qualitative early warning signals for funds and historic causes of failure.

  • Early warning signals of fund and alternative fund credit issues
  • Summary of major hedge fund failures, causes and common themes

Fund Manager

Evaluate the roles and responsibilities of key parties to a fund and assess the financial strength of a fund manager.

  • Roles and responsibilities of various parties: Manager, trustee, directors, administrator, custodian etc.
  • Risk profiles of different business models: Institutional, retail, wealth management.
  • Due diligence fund manager: Business structure, independence and controls, investment process, risk management, communication
  • Exposure types to a fund manager: Block trading, risk management, leverage
  • Fund manager as liquidity and capital provider to a fund
  • Purpose payback: Why do fund managers borrow and how do they service debt
  • Financial analysis: performance measurement; cash-flow analysis; balance sheet strength and rating agency benchmarks
  • Case study: Assessing an international fund and hedge fund manager

Structure

Assess exposures to a fund/hedge fund and appropriate documentary protections for uncleared / bilateral Over the Counter Trades (OTC) trades.

  • Assessing the appropriateness of the structure in terms of amount, maturity
  • Ranking: Establishing and maintaining a senior position
  • Collateralisation of uncleared OTC derivative trading transactions, initial and variation margin
  • Documentation safeguards: Close out and settlement netting, collateral, unsecured thresholds, covenants, break clauses, MTM resets, guarantees and Central Counterparty settlement overview
  • Managing the default process
  • Exercise: Calculating margin collateral, quantitative and qualitative considerations

Who Should Attend?

Commercial and investment banking professionals responsible for credit risk management and origination. The course is also appropriate for a wider audience of risk managers, consultants, bankers, regulators and other professionals who need to understand the key risk issues of the asset management industry.

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Course Highlights

Real Case Studies

Real company case studies to test your newly learnt skills

CPD Recognized

This course is Continuous Professional Development (CPD) recognized

Highly Interactive

Highly interactive with small group size and industry expert trainers

Frequently Asked Questions

Currently, course can be taken either in an in-person setting or in a live online setting.

Our virtual live online courses are designed to keep the same levels of engagement and networking as our in-person courses. You will attend the course virtually on a set date, at a set time.

What time zones do the courses run in?
Currently, we run live online training across London, New York and Singapore time zones.

How are the courses delivered?
We deliver virtual training via Zoom.

What are the start times?
The courses will run during scheduled class times, and vary per course.

Reclaiming VAT
Most delegates who attend our courses in the UK are able to claim back their VAT once it has been paid. The below information details why we need to charge VAT and how you can claim it back.

Why does Fitch Learning charge VAT?
The EU VAT Directive (Council Directive 2006/112/EC) article 53 says that for the right of entry to cultural, artistic, sporting, scientific, educational, entertainment or similar events in exchange for a ticket or payment, the place of supply is where the event physically takes place. Since, the event is held in the UK, the place of supply is the UK and therefore UK VAT has to be charged.

How can you claim back the VAT you paid for a course?
The most efficient way to claim back VAT is directly through the UK’s HM Revenue and Customs (HMRC) by completing the required forms and sending back to HMRC.

Please follow the links below for further details;

EU businesses
Non-EU businesses
To claim back VAT or if you have any questions please contact HMRC;

Telephone - 0044 (0) 3000 537 381

Email Overseas Repayment Unit - enq.oru.ni@hmrc.gsi.gov.uk

On the Fitch Learning website you will find learning paths which will explain the courses available at different levels within a topic area. We would always prefer to speak with you to discuss which course is most appropriate rather than run the risk of you signing up for an inappropriate course. If you are unsure, please contact the Public Courses team:

Phone: +44 20 7496 8600
Email: enquiry@fitchlearning.com

All of our instructors are industry practitioners turned trainers. Their training style is case study based and interactive. They will coach, challenge and inform participants to ensure immediate and practical real-life application from the courses. To discuss our instructors further please email enquiry@fitchlearning.com

Class sizes are dependent on the course, but are small enough to permit active interaction and participation.

Q. Am I able to gain CPD/CE/CPE credits for my course?
A. We award continuing professional development credits for the following:

Global
CFA Institute
The CPD Certificate Service
UK
CFA Society
The CPD Certificate Service

Q. What do I need to do to receive my credits?
A. Please email enquiry@fitchlearning.com to request a certificate. Fitch Learning will send you a certificate stating how many points you are eligible for.

Q. How many credits will I receive?
A. We award 8 credits (7 for the CFA) for each day of training you attend.

You will be contacted by email within 2 working days of processing your registration to confirm your place on the course.

In order to optimise class time we ask participants to read some background information on the main illustration case(s) prior to attending the class. This also helps to ensure that all are able to participate in case discussions. In some cases additional background reading is provided. The length of pre-course reading is advised to participants in advance and typically ranges from 2-3 hours.

We try to send out the pre-course reading by email one week before the start of the course. There may be a delay in sending this out due either to late registrations or to the fact that the case study needs to incorporate recently-published financial information.

Q. If I am unable to attend can I send a substitute?
A. Absolutely and it is completely free of charge. We do however ask that we have at least 2 working days’ notice of this change before the course start date. Please email enquiry@fitchlearning.com with full contact details of the substitute and who they are replacing.

Q. Can I transfer my booked course to another date?
A. Yes you can. If you email us your request to transfer to the next available course date and give us more than 30 days’ notice, there will be no charge. If you notify us within 30 days of the course start date, there will be an additional payment of 25% of the course fee, provided the original course fee has been paid in full.
A transfer can only be made onto a course taking place within a period of 6 months of the original course date and only one transfer can be made in respect of any booking.

Q. Can I cancel my course booking?
A. Yes. If you email us with your request more than 30 days before the course start date, there will be no charge. If you notify us within 30 days of the course start date you are liable for the full course fees.

Q. What happens if I do not attend my course?
A. If you do not attend your course and you do not give us any prior notice you are liable for the full course fee and no refunds can be given.

Notice contact details:
Email: enquiry@fitchlearning.com

We can develop a customized training solution to meet your learners' needs - at all levels in your organization. Please email enquiry@fitchlearning.com for more information.

Please get in touch with us via email at enquiry@fitchlearning.com to request more information on running one of our courses in-house for larger groups.

Discount offers cannot be used in conjunction with each other or any other offer nor applied retrospectively to anyone already registered for any Fitch Learning course.

To speak to a member of our team, please get in touch via the below:
Phone: +44 20 7496 8600
Email: enquiry@fitchlearning.com

Q. How do I make a complaint?
A. Anyone who wishes to make a complaint may do so in writing. Complaints need not be made to the actual service which is the subject of the complaint. In the first instance complaints should be sent to Grace Heighington, Head of Public Courses.

Q. Where do I send my complaint?

A. Complaints can be submitted using the following options:
Email: enquiry@fitchlearning.com
Post: Grace Heighington, Fitch Learning, The Corn Exchange, 55 Mark Lane, London, EC3R 7NE
Wherever possible and appropriate, staff are requested to elicit from the complainant the nature of the complaint, as well as the actions the complainant feels are necessary to resolve the complaint.

Complaints Policy and Procedure
Q. What are the stages involved?

A. There are two main stages to our complaints procedure:

Stage 1 - We always try to resolve issues quickly. From the moment we receive your complaint, we must get back to you within three working days. At the very least we must acknowledge the problem in writing and give you the name of the person dealing with the complaint. We must give you a full reply within ten working days if possible, or keep you fully informed of the progress and reasons for delay.

Stage 2 - If you are not happy with the full response at Stage 1, please contact us again. One of the Managing Directors will then review the issue. You can expect our acknowledgement within three working days of us receiving your complaint. We will also explain how long the director's review will take.


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