This introductory series guides students through the evolution of asset securitization, which results in new products for investors and expanded sources of funding and risk transfer opportunities for issuers. It shows how an asset-backed security is constructed, rated by the credit agencies, traded, and valued. The series also explores the different ABS market segments, from the large, established segments like automobile loans, to emerging and sub-prime market segments. The series concludes with a look at current trends in the industry.
Who should take this course:
Newcomers to the bond markets, institutional sales staff, sales and capital markets assistants.
Prerequisites:
None
Training Hours/CPE Credits:
5
Modules
Introduction to Asset Backed Securities
Module Code
:
strm_1001
Level
:
Basic
Training Hours/ CPE Credits
:
1
Module Description:
This module will provide you with an introduction to ABSs. It begins with a definition of the product and how it works. Then it looks at the evolution of the market, as well as the market's current and future prospects.
Learning Objectives:
Upon completion of this module the learner will be able to:
Define asset-backed securities (ABSs).
List the advantages for issuers of and investors in ABSs.
Identify the different roles played by issuers, investors, and dealers in the ABS market.
Structure and Rating of Asset Backed Securities
Module Code
:
strm_1002
Level
:
Basic
Training Hours/ CPE Credits
:
1
Module Description:
This module will show you how asset-backed securities are structured. Next, you'll learn how credit ratings are applied to ABSs, and how we can use these ratings to meet our investment goals. We'll also look at the various credit enhancements available to issuers and dealers to help boost the rating of an ABS.
Learning Objectives:
Upon completion of this module the learner will be able to:
Recognize the differences between pass-through and pay-through trust structures.
Describe the role of a Special Purpose Vehicle in structuring ABSs.
Define the most common types of credit enhancements.
Identify the elements by which rating agencies evaluate and monitor credit worthiness.
Major Sectors of the Asset Backed Securities Market
Module Code
:
strm_1003
Level
:
Basic
Training Hours/ CPE Credits
:
1
Module Description:
This module will cover various ABS sectors. We'll help you identify the strengths and weaknesses of each sector. We'll also show you the similarities and differences among the various sectors.
Learning Objectives:
Upon completion of this module the learner will be able to:
Identify the differences between the MBS and ABS markets.
Identify the structure, sources of income and risks of credit card ABSs.
Describe how auto loan ABSs are structured.
Recognize the structure, risks and credit enhancements of Home Equity Loan (HEL) ABSs.
Describe how Collateralized Debt Obligations (CDO) work.
Pricing and Trading of Asset Backed Securities
Module Code
:
strm_1004
Level
:
Basic
Training Hours/ CPE Credits
:
1
Module Description:
This module discusses how ABS securities are priced and traded in the market. We'll begin by looking at the concept of spreads. Then, we'll learn how the market assigns a value to an ABS in the context of the broader fixed-income market. We'll also look at the relative pricing of different ABS products, and why there are differences in pricing among the various sectors of the market.
Learning Objectives:
Upon completion of this module the learner will be able to:
Recognize the role of spreads and benchmarks in pricing ABSs.
Distinguish the different factors that impact ABS spreads.
Identify the relative pricing of different ABS sectors and the fixed-income market.
The Future of the Asset Backed Securities Market
Module Code
:
strm_1005
Level
:
Basic
Training Hours/ CPE Credits
:
1
Module Description:
This module will discuss the future of the ABS market. We'll be talking about the ABS products and market segments that we believe will emerge or expand in the future. We will also explore the trend towards ABS expansion outside the US market.
Learning Objectives:
Upon completion of this module the learner will be able to:
Recognize potential new collateral assets for ABSs.
Recognize ways current ABS products are likely to expand in the future.
Identify how derivatives are being used within ABSs.
Explain the opportunities for ABS growth in Europe, Asia, and Latin America.
