Learning path
Capital Markets & Trading learning path: everything to study, topic by topic
Comprehensive capital markets assessment covering fixed income, equities, derivatives, risk management, trading strategies, regulatory compliance, and cross-asset expertise.
Short answer
To learn Capital Markets & Trading, work through 7 modules and 20 topics in the order they build on each other. It starts with Fixed Income Fundamentals, then moves on to Equity Markets and Derivatives. Use the map as a checklist, or measure your level and study only what is missing.
What you will study
Topics are grouped by module. Open one to see its objectives and key concepts.
1 · Fixed Income Fundamentals3 topics
Bond Pricing & Duration
Bond valuation mechanics, DV01, PV01, modified duration, Macaulay duration, convexity, and price-yield relationship
Objectives
- Calculate bond price from cash flows and explain the price-yield inverse relationship
- Compute and interpret DV01, modified duration, and convexity for a bond portfolio
Key concepts
- DV01
- PV01
- modified duration
- Macaulay duration
- convexity
- clean vs dirty price
Yield Curves & Term Structure
Yield curve construction, bootstrapping, spot and forward rates, SOFR transition, and term structure models
Objectives
- Bootstrap a spot rate curve from par bond prices and derive implied forward rates
- Explain SOFR-based curve construction and the transition from LIBOR
Key concepts
- spot rate
- forward rate
- bootstrapping
- SOFR
- OIS curve
- term premium
- yield curve shapes
Credit Spreads & Analysis
Z-spread, OAS, asset swap spread, CDS basis, credit curve construction, and investment-grade vs high-yield spread dynamics
Objectives
- Decompose a corporate bond spread into z-spread, OAS, and the option-adjusted component
- Analyze the CDS-bond basis and explain when it indicates relative value
Key concepts
- z-spread
- OAS
- asset swap spread
- CDS basis
- credit curve
- IG vs HY spread dynamics
2 · Equity Markets3 topics
Equity Valuation
DCF, comparable company analysis, dividend discount model, residual income model, and sector-specific valuation approaches
Objectives
- Apply DCF and relative valuation methods to derive an equity fair value range
- Select appropriate valuation multiples based on sector, growth profile, and capital structure
Key concepts
- DCF
- EV/EBITDA
- P/E ratio
- dividend discount model
- residual income model
- SOTP valuation
Market Microstructure
Order types, price discovery, bid-ask spread mechanics, market makers, dark pools, and exchange vs OTC execution
Objectives
- Explain how the limit order book drives price discovery and bid-ask spread formation
- Compare exchange-traded, OTC, and dark pool execution and their impact on market quality
Key concepts
- limit order book
- bid-ask spread
- market maker
- dark pool
- price discovery
- OTC vs exchange
Equity Indices & Benchmarks
Index construction methodologies, rebalancing mechanics, index tracking, factor tilts, and benchmark selection
Objectives
- Compare market-cap, equal-weight, and factor-based index construction methodologies
- Analyze the impact of index rebalancing on constituent stocks and tracking portfolios
Key concepts
- market-cap weighting
- equal weighting
- free-float adjustment
- index rebalancing
- tracking error
- factor indices
3 · Derivatives3 topics
Options Pricing & Greeks
Black-Scholes model, binomial trees, Greeks (delta, gamma, vega, theta, rho), implied volatility surfaces, and volatility smile
Objectives
- Price a European option using Black-Scholes and explain each input's sensitivity via Greeks
- Interpret the volatility smile and skew and explain their implications for pricing
Key concepts
- Black-Scholes
- delta
- gamma
- vega
- theta
- rho
- implied volatility
- volatility smile
Interest Rate Swaps & Swaptions
IRS mechanics, swap valuation, SOFR swap curves, basis swaps, swaption pricing, and swap spread analysis
Objectives
- Value an interest rate swap using SOFR discount factors and explain swap spread dynamics
- Design a DV01-neutral hedge using swaps for a fixed-income portfolio
Key concepts
- fixed-for-floating swap
- swap rate
- SOFR swap curve
- basis swap
- swaption
- swap spread
- DV01 hedging
Structured Products
CLOs, CMOs, ABS tranching, waterfall structures, prepayment risk, and structured note payoff profiles
Objectives
- Explain CLO/CMO tranching mechanics and how the waterfall distributes cash flows and losses
- Assess prepayment risk and subordination levels in a structured product
Key concepts
- CLO
- CMO
- ABS
- tranching
- waterfall
- prepayment risk
- subordination
- credit enhancement
4 · Risk Management3 topics
Market Risk & VaR
Value-at-Risk methodologies (parametric, historical, Monte Carlo), expected shortfall, stress testing, and backtesting frameworks
Objectives
- Calculate VaR using parametric, historical, and Monte Carlo methods and compare their assumptions
- Design a stress testing framework that captures tail risk beyond VaR
Key concepts
- parametric VaR
- historical simulation
- Monte Carlo VaR
- expected shortfall
- stress testing
- backtesting
Counterparty Credit Risk
CVA, DVA, potential future exposure, netting agreements, collateral management, and central clearing mandates
Objectives
- Calculate CVA for an interest rate swap portfolio and explain the impact of netting and collateral
- Compare bilateral vs centrally cleared derivatives and their counterparty risk implications
Key concepts
- CVA
- DVA
- potential future exposure
- netting
- CSA
- central clearing
- initial margin
Liquidity Risk
Funding liquidity, market liquidity, liquidity coverage ratio (LCR), net stable funding ratio (NSFR), and liquidity stress scenarios
Objectives
- Distinguish funding liquidity from market liquidity and explain their feedback loop in a crisis
- Calculate LCR and NSFR and assess a bank's liquidity adequacy under stressed scenarios
Key concepts
- funding liquidity
- market liquidity
- LCR
- NSFR
- bid-ask bounce
- fire sale discount
- liquidity horizon
5 · Trading Strategies3 topics
Execution Strategies
VWAP, TWAP, implementation shortfall, market impact modeling, optimal execution theory, and transaction cost analysis
Objectives
- Select the optimal execution strategy given order size, urgency, and market conditions
- Perform transaction cost analysis decomposing explicit and implicit costs
Key concepts
- VWAP
- TWAP
- implementation shortfall
- market impact
- transaction cost analysis
- optimal execution
Portfolio Construction
Mean-variance optimization, factor models, risk budgeting, position sizing, and portfolio rebalancing strategies
Objectives
- Construct an efficient portfolio using mean-variance optimization with factor constraints
- Implement a risk budgeting framework that allocates risk across asset classes and strategies
Key concepts
- mean-variance optimization
- factor models
- risk budgeting
- position sizing
- Sharpe ratio
- information ratio
Algorithmic Trading
Algorithm design, smart order routing, latency considerations, market-making algorithms, and stat-arb frameworks
Objectives
- Design a market-making algorithm with inventory management and adverse selection controls
- Evaluate a statistical arbitrage strategy including signal generation, decay, and capacity
Key concepts
- smart order routing
- latency arbitrage
- market-making algorithm
- stat-arb
- signal decay
- alpha research
6 · Regulatory & Compliance3 topics
Market Regulation
MiFID II, Dodd-Frank, Volcker Rule, position limits, trade reporting, and market abuse regulation
Objectives
- Compare MiFID II and Dodd-Frank approaches to OTC derivatives regulation and trade reporting
- Explain the Volcker Rule's impact on proprietary trading and market-making activities
Key concepts
- MiFID II
- Dodd-Frank
- Volcker Rule
- position limits
- trade reporting
- MAR
Basel III/IV Capital Framework
Risk-weighted assets, capital ratios (CET1, Tier 1, Total Capital), FRTB, leverage ratio, and output floor
Objectives
- Calculate CET1 capital ratio and explain the FRTB impact on trading book capital requirements
- Assess the strategic implications of Basel IV output floors on internal model-based banks
Key concepts
- CET1 ratio
- risk-weighted assets
- FRTB
- leverage ratio
- output floor
- standardized approach
- IMA
Best Execution & Conduct
Best execution obligations, order handling rules, conflicts of interest, suitability requirements, and conduct risk frameworks
Objectives
- Design a best execution policy compliant with MiFID II RTS 27/28 requirements
- Identify and manage conflicts of interest in a multi-desk trading operation
Key concepts
- best execution
- RTS 28 reports
- order handling
- conflicts of interest
- conduct risk
- suitability
7 · Expert Capital Markets2 topics
Exotic Derivatives
Barrier options, Asian options, lookback options, autocallables, quanto adjustments, and correlation products
Objectives
- Price barrier and Asian options and explain model risk versus Black-Scholes assumptions
- Analyze autocallable payoff profiles and their sensitivity to correlation and volatility parameters
Key concepts
- barrier option
- Asian option
- autocallable
- quanto adjustment
- correlation trading
- local volatility
- stochastic volatility
Cross-Asset Relative Value
Macro strategy, cross-asset correlations, curve trades, basis trades, capital structure arbitrage, and regime analysis
Objectives
- Construct a cross-asset relative value trade with clearly defined entry, hedge, and exit criteria
- Analyze regime-dependent correlation breakdowns and their implications for multi-asset portfolios
Key concepts
- cross-asset correlation
- curve trade
- basis trade
- capital structure arbitrage
- regime switching
- macro relative value
Levels: Junior, Mid, Senior, and Expert
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Frequently asked questions
Where should I start studying Capital Markets & Trading?
Start with Fixed Income Fundamentals: Bond Pricing & Duration, Yield Curves & Term Structure, and Credit Spreads & Analysis. The map orders topics by what they depend on, so each one prepares the next.
How long does a full Capital Markets & Trading assessment take?
A full assessment of this path takes about 55 minutes. Study time depends on where you start; a diagnostic shows which topics you can skip.
Do I need an account to use this page?
No. The map, objectives and key concepts are open. You only need an account to be measured, get your gap by topic and receive a plan.