Credit Derivatives - Introduction


Cost for BPP PD Members: £490 + VAT 6 CPD Hours
(£615.00 + VAT for non BPP PD Members Click Here for details of our membership scheme).

Course level



This one-day interactive, case study based course will help those with little or no knowledge of credit derivatives to gain a good understanding of the intrinsic nature of the main instruments and the markets on which they trade. It is particularly relevant for investment bankers, corporate financiers, corporate bankers, investment managers, analysts, brokers, investment advisers, operations and support staff and others involved with the credit derivative markets for the first time.


This introductory one-day course aims to cover the key aspects of credit derivative instruments and markets – market terminology and structure, pricing, trading and investing - as well as laying a foundation of technical and practical knowledge. It will enable you to identify and compare different credit derivative instruments (including credit default swaps, total return swaps, credit options and credit linked notes) and consider the factors which determine their pricing. Delegates will also grasp an understanding of the main ways credit derivatives are used and why the market is growing so rapidly.

Learning outcomes include obtaining a greater understanding of

  • Introduction to the Credit Derivatives Market
    • What is credit risk?
    • What are credit derivatives and what do they allow?
    • Market overview – market size, growth, key players
  • Credit Market Jargon and Terminology
    • How do we measure credit risk?
    • Ratings, agencies, default and recovery rates
    • Cohorts and transition matrices
    • Credit spreads
    • Default risk, spread risk and downgrade risk
  • Overview of Key Credit Derivative Products
    • Market breakdown by product
    • Credit forwards – description and uses
    • Credit swaps (credit default swaps and total return swaps) – description and uses
    • Credit options – description and uses
    • Credit linked notes – description and uses
  • Other Issues in Credit Derivatives
    • Using credit derivatives to create synthetic positions
    • The use of credit derivatives in CDO structures
    • Documentation issues and market regulation
    • Pricing credit derivatives – an overview and example

"A CPD certificate of completion will be provided by BPP Professional Education Limited upon request, following attendance."

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