This article written by Akshit GUPTA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) explains the mechanisms of initial and maintenance margin used in stocks. Introduction In financial markets, margin requirements are present in leveraged positions in stock trading. They refer to a percentage of assets that an investor must put aside … Read more
This article written by Akshit GUPTA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) explains the mechanisms of initial and maintenance margin used in futures contracts. Introduction In financial markets, margin requirements are present in leveraged positions in derivative products. They refer to a percentage of assets that an investor must pay … Read more
In this article, Jayati WALIA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) explains the concept of moving averages and its implementation in financial markets as an indicator in technical analysis of stock price movements. What is a moving average? A moving average is a technique to analyze a time-series of data … Read more
This article written by Akshit GUPTA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) explains asset allocation, a much-discussed topic in asset management. Introduction Asset allocation refers to the process of dividing an investment among different assets and, at a more integrated level, asset classes, sectors of the economy and geographical areas. … Read more
Barrier options In this article, Shengyu ZHENG (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains barrier options which are the most traded exotic options in derivatives markets. Description Barrier options are path dependent. Their payoffs are not only a function of the price of the underlying asset relative to the option … Read more
In this article, Youssef Louraoui (Bayes Business School, MSc. Energy, Trade & Finance, 2021-2022) presents the Fama-MacBeth two-step regression method used to test asset pricing models. This article is structured as follow: we introduce the Fama-MacBeth testing method. Then, we present the mathematical foundation that underpins their approach. We conclude with a practical case study … Read more
In this article, Youssef LOURAOUI (Bayes Business School, MSc. Energy, Trade & Finance, 2021-2022) elaborates on the concept of Hedge Funds. Hedge funds are a type of asset class that differs from standard fixed-income and equities investments in terms of risk/return profile. The structure of this article is as follows: First, we will define a … Read more
Big data in the financial sector In this article, Rayan AKKAWI (ESSEC Business School, Master in Strategy & Management of International Business (SMIB), 2021-2022) explains the role of big data in the financial sector. Big data is a term used for contemporary technologies and methodologies that are used to collect, process, and analyze complex data. … Read more
In this article, Diana Carolina SARMIENTO PACHON (ESSEC Business School, Master in Strategy & Management of International Business (SMIB), 2021-2022) explains the economic concept of risk aversion, which is key to understand the behavior of participants in financial markets. Risk Aversion refers to the level of reluctance that an individual possesses towards risk. Specifically, it … Read more
In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains the importance of data providers and how they influence global finance… What are data providers? A data provider is an intermediary between data and data users. Indeed, a data provider provides market data to financial firms, traders, and … Read more
In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains the importance of data-management for corporations and how they are used to improve profitability. According to a study published by CapGemini untitled: The data-powered enterprise: Why organizations must strengthen their data mastery, it is estimated that the gain … Read more
The incredible story of Nick Leeson & the Barings Bank In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) looks back at the bank fraud of Nick Leeson, a trader at Barings, which led to the collapse of the UK’s oldest investment bank… History of Barings and Nick … Read more
In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains how Bruno Iksil, a French trader working in London made inconsiderate trades in the name of the renown JP Morgan. Bruno Iksil: background of a French trader based in London Bruno Iksil, known as “The Whale”, is a … Read more
This article written by Akshit GUPTA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) explains Eurobonds traded in financial markets. Introduction In financial markets, bonds are debt securities used by issuers to raise capital from investors. In return investors get an interest payment on the principal invested over the life of the … Read more
This article written by Akshit GUPTA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) explains Green bonds traded in financial markets. Introduction A green bond is a fixed-income product that works like a conventional bond, except that the money invested in them is used exclusively to finance green projects that support environment … Read more
Wirecard: At the heart of the biggest German financial scandal of the 21st century In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains what happened with Wirecard, the German company that caused a major scandal in the German financial place. Quick review of the Wirecard company The … Read more
In this article, Louis DETALLE (ESSEC Business School, Programme Grande Ecole – Master in Management, 2020-2023) presents three major corporate frauds of the 21st century. Enron (2001) Enron was a leader in the raw material and energy sector in 2000. Kenneth Lay and Jeffrey Skilling were the two leaders of the group who have disguised … Read more
The regulation of cryptocurrencies: what are we talking about? In this article, Hugo MEYER (ESSEC Business School, Master in Strategy & Management of International Business (SMIB), 2020-2021) presents the regulation of cryptocurrencies. Introduction The first cryptocurrency – Bitcoin – launched in 2008 by Satoshi Nakamoto had for ambition to “break the rules and change the … Read more
In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains what a tax specialist works on, on a daily basis. The most famous amongst all frauds ever: Charles Ponzi Born in 1882, this Italian man has built himself quite a reputation in the fraud industry due to his … Read more
This article written by Akshit GUPTA (ESSEC Business School, Grande Ecole Program – Master in Management, 2019-2022) presents the concept of protective put using option contracts. Introduction Hedging is a strategy implemented by investors to reduce the risk in an existing investment. In financial markets, hedging is an effective tool used by investors to minimize … Read more