Based on the ISO definition of an investment fund specifying that an investment fund is a collective investment scheme based on a diversified portfolio of assets that is managed by a professional fund manager, the content of module 6 focuses on:
Main characteristics of investment funds (based on ISO 10962)
Types of investment funds - Traditional “long only” funds (in Europe, UCITS funds), hedge funds, private equity funds, real estate funds, exchange-traded funds, funds of funds, pension funds, others
Attributes of investment funds - Open end/closed end funds, liquid assets/illiquid assets, asset type, level of regulation, incorporated/unincorporated, domicile, active/passive management, alternative management
Pricing of investment funds - NAV, negotiated price (ETFs)
Factors influencing the performance of investment funds - Price of the underlying assets, costs/revenues of the fund, leverage, performance of the fund manager, market situation
Costs associated with transactions and services involving investment funds - Sales charges (subscription/redemption fees), performance fees, administration fees, other fees (e.g., switching fees), commissions
Structure of the market for investment funds
Types of markets (regulated, OTC) - Direct subscriptions/redemptions with the fund (through a distributor and the transfer agent), organised markets (exchanges, MTF, OTF, SI) for ETFs
Primary and secondary markets - Launching a fund (open- end/closed-end), primary market for funds on exchanges (primarily ETFs), normal fund operations (subscriptions/redemptions)
Market players - Fund manager, distributor, fund administrator (includes fund accountant, transfer agent, domiciliary agent), custodian/depositary, exchange and brokers (for ETFs), paying agent
Financial instruments as investments
Market practice - Instrument with wide range of risk (from UCITS to hedge funds), collective investment, economies of scale, long-term savings instrument, low volatility, low fees
Main risks - Market risk, liquidity risk, credit risk, operational risk
Tax aspects - Withholding tax, capital gains tax, tax reclamation, subscription tax
Market forces that impact performance - Price of the underlying assets, volatility, liquidity, interest rates, currencies, macroeconomic factors
Understanding instrument’s performance - Value of the underlying assets, performance of the fund manager, costs/revenues of the fund, market perspective, volatility
Documentation related to the instrument - Prospectus (or offering/information memorandum), KIID, PRIIP, terms and conditions, fact sheets
The persons concerned by the Training Programme are all persons placed under the authority of a professional (or acting on his behalf) subject to prudential supervision by the CSSF, i.e. individuals providing investment advice (“Advisory profile”) or information (“Information profile”) on financial instruments, investment services or ancillary services to clients.
Experienced professional specialists selected on the basis of their in-depth knowledge of markets and financial products under MiFID rules I and II, and ESMA criteria.
Session delivery: French
Course material: English
Assessment and Certification: English or French
Please note that, for environmental reasons, no paper version of the training material will be provided for your training. The course material can be downloaded free of charge via your portal before the start of the course (download the Client Portal User’s Guide here ). You will be able to view it on the screen of your mobile device or print it if necessary. If your registration has been made by a training manager of your company, please contact him/her so that he/she can give you access to it or send it to you.
This module is part of the MiFID II Certification. For more details about this Certification, please click here.