Code

COMPGS07 (Also taught as: COMPM027)

Year

MSc

Prerequisites

COMPGS06 is highly recommended, along with an understanding of the fundamentals of software engineering and basic economics.

Term

2

Taught By

Antoaneta Serguieva (100%)

Aims

The module provides instruction in the impact and use of information technology in the financial services sector, including exposure to and experience with different kinds of financial services software applications.

Learning Outcomes

Upon successful completion of the module, students will understand information technology’s impact on banking and markets; have knowledge of the leading-edge applications of information technology in financial services firms; understand financial automation and how industry continues to be altered by telecommunications and information systems; be able to implement computer-based financial analysis and apply financial models to solve problems; understand how to use financial decision support software; have knowledge of specific classes of financial information systems such as electronic communication networks (ECNs) and multilateral auction systems, trader workstations, fund transfer networks and back office systems; and be able to apply the knowledge and understanding they have gained in real-world financial service contexts.

Introduction and Overview of Course Topics

Information Systems in the Financial Services Industry

Financial Software and Analytic Tools

Derivatives Analysis Software
Position Analysis and Hedge Construction
Options Markets
Currency Markets: Cash and Derivatives

Banking and Payment Processing Systems

Financial Transactions Processing Systems (TPS)
Advances in Payments and Transactions Technology
Competition in Payments Networks
Secure Payments and Electronic Money
Regulation of Payments and Digital Cash

Information Technology in the Financial Markets

Markets, Trading and Information Technology's role
Information Technology in Primary and Secondary Markets
Human Computer Interfaces: Black Box and Algorithmic Trading
Standards and Protocols for Financial Messaging
Effects of Electronic Markets on Exchanges and Traders

Financial Markets Infrastructure: Front-Office and Back-Office Systems

Trading Room Operations: Matching, Confirmations, Margining
After the Trade: Clearance and Settlement Systems
Control of Trading and Finance Activities
Disintermediation in Primary Markets and Trading/Secondary Markets

The module will be delivered through a sequece of in-class lectures, supplemented by coursework, hands-on exercises with software packages and financial data, and a final examination.

The course has the following assessment components:

• Written Examination (2.5 hours, 75%)
• Coursework Section (2 pieces, 25%)

To pass this course, students must:

• Obtain an overall pass mark of 50% for all sections combined

The examination rubric is:
Answer all three questions. The number of marks available for each question is as follows: Q1 = 45; Q2 = 30; Q3 = 25.

Weber, B,. case and tutorials: 'IT in the Major International Financial Markets ', 'Derivatives Analysis Tutorial with Option

Simulator', 'Compendium on Payments Systems', 'Optimark: Computerizing Block Trading', 'Value at Risk (VaR): A primer for

VaR simulation analysis.'

Freedman, R. 'An Introduction to Financial Technology.'