Securities Lending
Description
Securities lending is a long-established practice which plays an important role in today’s capital markets by providing
liquidity that reduces the cost of trading and promotes price discovery in rising as well as falling markets. The
resultant increase in efficiency benefits the market as a whole – from the securities dealers and end investors through
to the corporate issuers which depend on efficient, liquid markets to raise additional capital.
Securities lending markets allow market participants to sell securities that they do not own in the confidence that they
can be borrowed prior to settlement. They are also used as a form of financing, through the lending of securities
against cash, forming an important part of the money markets. The ability to lend and borrow securities freely
underpins the services that securities dealers offer their customers and the trading strategies of dealers, hedge funds
and other asset managers. On the lending side, securities lending forms a growing part of the revenue of institutional
investors, custodian banks and the prime brokerage arms of investment banks. The course gives a key features of Securities Lending
is issued on the Luxoft Training form
Objectives
To provide the audience the understanding of the distinguishing features of Securities Lending, their participants,
market mechanics and risks.
Target Audience
Testers, System and Business Analysts, Architects, Developers, and Project Managers working on financial markets
projects
Prerequisites
FIN-001. Introduction into Financial Markets
FIN-020. Introduction into Investment Banking
Roadmap
Overview of securities lending
Lenders and intermediaries
The borrowing motivation
Market mechanics
Risks