I have been teaching variations of the Financial Risk Management and Derivative pricing course at the SP Jain Campuses in Dubai and Singapore for about 5 years. While the original edition of FinanceTrainingCourse.com came about as a supporting tool for my MBA (EMBA and GMBA) students, I had always felt a need for a complete training course page that would document step by step the materials that we actually covered in the Financial Risk Management class. Not just the lesson plans, but the excel files, the discussion and the power point slide deck.
It would be useful not just for historical record but as a starting point for anyone interested in exploring the subject of Financial Risk Management for the very first time. The only problem is that when you try and do this you effectively end up teaching two courses. Once in the class room and then later on in word when you sit down and put your thought and your notes down for posting on the site.
Teaching it online is a lot more difficult.
This trip I finally decided to take the leap and do it. So for the past three days, a few hundred students from all over the world have been following what a group of bright MBA candidates have been doing with me on the topic of Financial Risk Management. The course started on 24th June 2012, on Sunday afternoon at the Academic city campus of SP Jain and we have been having a lot of fun with data, numbers and models. There were some hiccups initially but for the last two days we have been working hands on with Excel modeling and that has helped.
We have three cases to illustrate and support understanding of risk management. A corporate hedging case that uses the example of an airline interested in hedging its fuel exposure to rising oil prices. This is in addition to the petrochemical refinery hedging case study shared earlier on this site as well as at FinanceTrainingCourse.com. The second is a bare bone ALM case study that starts with basic principles of duration and convexity and then introduces gaps, target accounts and ALM reports.
In putting together the lesson plan we assumed some background and knowledge in finance and statistics but no prior introduction to risk management. Hence a start with the very basics of topics. Over the first three days we have now built models for tracking volatility, correlation matrices, value at risk, Monte Carlo simulation, probability of shortfall methods and ALM models. While the first three updates came in quick succession, there has now been a lag for two days. But you can still catch up.
Here are the details for joining the free online financial risk management class – no registration is required. The training course was originally designed for business school students and MBA but draws materials from my mainstream risk management courses delivered to banking, treasury and risk customers in the Middle East and Far East.
Financial Risk Management Training Course announcement
Financial Risk Management Course – Follow up and Student Updates
Introducing Value at Risk, Volatility and Trailing Correlations
– Day One Updates
The Fuel Oil Hedging Case Study – Day Two update
– Day Two Updates
Ps. If you like this experiment please feel free to drop me a line. Would love to hear about your feedback and what we can do to make this a better, more productive learning experience for all of us.