Equities

Valuation, earnings, indices, flows and equity derivatives.

1. E1How equity markets workRead the prices people are bidding and offering, work out what a quick purchase really costs, and turn one company’s move into the index’s move.8 min
2. E2Valuation for traders: P/E, yields and ratesSay how many years of profit a share costs, compare shares with bonds, and explain why rising interest rates hurt fast-growing companies most.9 min
3. E3Earnings and eventsExplain why a share can fall on good results, read the move options expect, and size what index changes and takeover bids do to a price.8 min
4. E4Short selling and securities lendingWork out what a bet on a falling share costs to hold, and spot when too many people are making the same bet.8 min
5. E5Equity forwards and futuresWork out what an index future should cost, say what to do when it costs something else, and size a futures hedge for a portfolio.9 min
6. E6Delta one: swaps, CFDs and ETFsWork out what a share swap pays, say why funds use swaps instead of buying shares, and explain what keeps an ETF’s price close to its holdings.8 min
7. E7Convertible bondsWork out what a convertible bond is worth as shares, say whether it behaves like a bond or like the shares, and hedge it with a short.9 min
8. E8Structured products and dealer flowsBuild a capital-protected note from a bond and an option, work out what it pays, and say which risks the bank that sold it keeps.9 min
9. E9Hedging an equity portfolioPick a way to protect a share portfolio from a fall, and work out what it costs and what it still leaves exposed.8 min