Introduction to the Underlying Markets

24 marks (16%)~8 hours study12 sections · 12 practice questions

Learning objectives

Describe the structure and operation of equity, currency, and fixed-income markets.
Explain how indices are constructed and rebalanced.
Define yield, duration, PVBP, convexity for fixed-income securities.
Read a yield curve and interpret its shape (normal, flat, inverted).
Articulate how risk and return are measured in each underlying market.

Topics covered

01Equity markets and equity indices

02Currency markets — INR vs other currencies

03Fixed-income securities — government and corporate bonds

04Interest rate concepts and yield curves

05Return and risk measures for debt — current yield, YTM, duration, PVBP, convexity

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study sections

First section: "Why this chapter matters"

cheat-sheet terms

Includes: Primary market, Secondary market, T+1 settlement...

practice MCQs

Interactive — click an option to reveal the correct answer + explanation

3 underlying tabs

Equity / Currency / Interest Rate views

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Learning objectives

Describe the structure and operation of equity, currency, and fixed-income markets.

Explain how indices are constructed and rebalanced.

Define yield, duration, PVBP, convexity for fixed-income securities.

Read a yield curve and interpret its shape (normal, flat, inverted).

Articulate how risk and return are measured in each underlying market.