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Bloomberg Market Concepts or BMC – Bloomberg Market Concepts examination is a self-paced online course aimed at introducing the fundamentals of finance to aspiring finance professionals. There have been a number of courses and online as well as contact programs which are designed to make students and entry-level professionals acquainted with the basic principles of finance and make them better equipped to deal with professional challenges in the field of finance.
This course is offered by the Bloomberg Institute, a globally acknowledged institution engaged in disseminating information on various financial domains and helping professionals develop their skills and capabilities in the desired manner. Bloomberg Market Concepts is more of a specialized online course which focuses primarily on market concepts, as the name suggests, and is best suited for anyone willing to develop a market-oriented career.
In the course of this article, we would elaborate on the outline, structure and contents of this course along with discussing potential benefits for the participants.
- What Bloomberg Market Concepts?
- Bloomberg Market Concept E-Learning Format
- Why Real-World Case Studies are Utilized in BMC?
- Bloomberg Market Concepts Examination Course Modules
- Bloomberg Market Concept – Course Fee
- Benefits of this BMC Course
- Bloomberg Market Concept – Sample Certificate
What Bloomberg Market Concepts?
- Bloomberg Market Concept is fast-paced e-learning course by Bloomberg that can be completed within a week and the participants are awarded with a certificate of completion at the end of the course.
- This course primarily includes 8 hours of video tutorials which utilize Bloomberg data, indices, analytics and news stories to impart knowledge of market essentials to the participants.
- The course material is divided into 4 modules dedicated to specific market sectors and participants are presented with 120 assessment questions throughout the modules.
- Another major attraction of the course is that it introduces participants to the Bloomberg Terminal, which is often employed by financial services firms for displaying, reading and interpreting financial data of various types.
Bloomberg Market Concept E-Learning Format
What makes this course so popular and easy to administer is the kind of flexibility it offers. One can could take it up and complete it through a Bloomberg Terminal at university campus, do it along with multitasking at work or simply take time to complete the course at home. However, it is strongly recommended to not take the course lightly and devote enough time to go through the contents and master them to be able to take full advantage in terms of acquiring useful knowledge, skills and capabilities.
You should have access to flash to be able to view the online content. It would be best to utilize a PC or laptop for the purpose instead of relying on a tablet or smartphone for the purpose. The learning material in the form of videos is also not typical in the sense that a person writes on the blackboard and explains the concepts. Instead, case studies, Bloomberg data, analytics, indices and news stories are utilized to present the concepts and their application in an interesting manner. Pimm Fox and Monica Bertran of Bloomberg Institute act as video narrators in an effort to make it easier for participants to understand the content better and grasp the concepts without much difficulty.
Why Real-World Case Studies are Utilized in BMC?
One might wonder why Bloomberg has relied on real-world case studies to illustrate the concepts presented in this course. One of the primary reasons has been perhaps to make it more engaging and relevant to the participants and when they study real-life significant events like the Great Depression, Bretton-Woods and the more recent global meltdown, memorizing the concepts becomes that much easier in that context. Additionally, the knowledge of real-world scenarios can be of great help to participants while appearing for interviews.
Bloomberg Market Concepts Examination Course Modules
source: Bloomberg Institute
BMC consists of 4 primary modules:
- Economic Indicators
- Fixed Income
To a beginner, gaining an insight into these market sectors can be immensely helpful and rewarding. However, it should not be considered a comprehensive treatment of any of these sectors in any case. The course content is more or less introductory in nature, with just enough information presented with the help of real-world illustrations and graphics which would help them get going without much effort.
This course also serves to introduce participants to the Bloomberg Terminal which is commonly employed by financial services firms. Along with the course contents, participants would be introduced to new Bloomberg Terminal functions at every step which can help retrieve, display, read and interpret data on the terminal. It offers a kind of limited practical exposure to Bloomberg Terminal which can come in handy later.
Each of these modules consist of several sub-modules and the participants are expected to acquire knowledge of at least one sub-module per sitting. Next, we would provide a brief overview of each of the primary modules to give readers an idea of what exactly would they learn from the course.
BMC Module I: Economic Indicators
source: Bloomberg Institute
- This module helps understand the significance of primary economic indicators and how they are used by investors to get an idea of the health of the economy.
- Helps them understand the format in which economic indicators are published and how they can be analyzed
- Acquire an understanding of good economic indicators.
- Techniques to study economic indicators
Economic Indicators is divided into 3 sub-modules, namely:
- The Primary of GDP
- Monitoring GDP
- Forecasting GDP
A brief outline of each of the sub-modules would also be appropriate here:
#1 – The Primary of GDP
Real GDP growth serves as an economic indicator of key significance for investors which clearly shows the current economic growth and prospects of future growth. Since GDP growth is cyclical in nature, it helps investors get an idea of where the economy stands in terms of this cyclical growth.
#2 – Monitoring GDP
Despite its apparent significance, GDP figures kind of represent the state of economy as it was sometime ago, instead of its current status. This is primarily because GDP figures are calculated on quarterly basis and it takes a while for authorities to come up with the exact figure and announce it publicly. Insead, monthly indicators including PMI and nonfarm payrolls which are quickly announced, attract wider attention amongst investors. These are also usually closely tied with GDP and can have a significant impact.
#3- Forecasting GDP
Analysts often publish the likelihood of performance of economic indicators. Though not exact in its nature, these estimates are often based on simulated economic models which provide a general overview of how economy is likely to perform in near future. Investors try to assess the mood of the economy based on how pessimistic or optimistic are prevailing indicators plus the future assessments of leading experts. This helps them identify possible inflection points and base key economic decisions on them.
Also look at Top 10 Economic Indicator to Watch
Bloomberg Terminal Functions for Module I
BMC Module II: Currencies
source: Bloomberg Institute
- Provides an inside view of the history of currency markets and how they perform
- Helps identify certain key points which might drive the currency evaluation
- Role played by banks and banking sector at large in effective management of inflation and deflation at their very source.
- Aimed at developing an understanding the role of currency markets in influencing the fortunes of businesses and investors and what they can do to avoid currency-related risks
#1 – Currency Market Mechanics
This sub-module introduces participants to the complex mechanics of currency markets and how several currencies are interlinked to allow for FX trades to take place. Earlier, any currency was solely pegged to the US Dollar for the kind of stability and liquidity it offers. In turn, the US Dollar was locked to gold at a specific price. However, since 1971, the gold conversion window for US dollar was suspended and the whole process has undergone a sea-change as a number of currencies have been free floating. These currencies float in a matrix of pairs which are valued through a process known as triangular arbitrage. Even so, nearly 85% of all currency trades still involve USD and is often employed as a central currency for conversion of two less liquid currencies.
#2 – Currency Valuation
This section helps understand the intricacies of currency valuation and how they help currency market perform efficiently. As we have pointed out, the direct link between paper currencies and gold was broken down back in 1971 and since, all currency valuations are quoted purely as relative to other currencies. It has to be understood that in long-run all goods and services should cost almost the same, irrespective of the location. However, in the short-run, which is of interest to investors, these are influenced by three leading factors.
- Sudden changes in interest rates
- Sudden changes in inflation
- sudden changes in quantities of trade
This is because all other things being equal, currencies with higher interest rates, lower inflation and higher net exports tend to be attractive.
#3 – Central Banks and Currencies
This sub-module deals with the role of central banks in managing national currencies. Participants learn how central banks regulate short-term interest rates which can influence currency valuation. In developed economies, commonly a goal of 2% inflation is targeted in an effort to control the risk of inflation as well a deflation. Latter can be harmful as well, since it leads to people losing interest in purchasing, thus affecting economic activity and growth.
#4 – Currency Risk
Essentially any businesses or investors involved in cross-border monetary transactions can be affected by currency movements. To understand currency risk both historic volatility and currency rate forecasts are considered. It explains how forward agreements can be entered into by such investors and businesses to minimize or avoid the risk of currency-related losses.
Bloomberg Terminal Functions for Module 2
BMC Module III: Fixed Income
source: Bloomberg Institute
- This section is dedicated to developing an understanding of how the history and dynamics of bond market and how it became the biggest and most complex market in the world.
- The ways in which yields facilitate comparison across a diverse and complex bond market.
- Participants would learn about how interest rates are decided by central banks.
- How bond valuation is driven by interest rates along with certain key factors including creditworthiness and inflation.
The Roots of the Bond Market:
This section introduces the concept of fixed income instruments and explains how it represents loan agreements where the borrower promises to py fixed, pre-agreed repayments at a certain future date. Governments often issue bonds to secure public loans for a variety of purposes which are secure and offer a higher level of liquidity. To compare the income from bonds, invrstors look for their respective yields.
Bond Valuation Drivers:
This section helps understand how bonds are valued, compared and what fears and considerations influence investor decisions.
Central Bankers & Interest Rates:
This section deals with how bankers and their regulatory measure to keep interest ratea in check which has a decided impact on bond market. Central banks usually keep an eye on the current level of inflation and deflation along with regulating interest rates and trying to understand where investors think the interest rates are headed.
The Yield Curve & Why it Matters:
This section explains what is the yield curve and how it affects bond markets. Yield curve depicts the cost of borrowing for various periods of time. It is described how when businesses or individuals borrow, the interest rates on loans are decided with reference to the government borrowing rate.
Movements in the Yield Curve:
This section deals with movements in the yield curve and what they mean for individuals, businesses and governments. The left-hand end of the curve is based on the interesr rates set by the central bank and is more or less fixed. However, the right-hand end of the curve represents the belief of investors about where will interest rates go. Participants would learn how to interpret the yield curve and study the intricacies of bond market.
Also, see Bond Pricing
Bloomberg Terminal Functions for Module 3
BMC Module IV: Equities
source: Bloomberg Institute
- This section would introduce participants to the fundamentals of equity markets and how they perform.
- This includes calculating equity index performance from the performance of specific stocks.
- Understanding how and why equities are more volatile as compared to bonds and why equity ownership is such an attractive proposition.
- Explain how industry and supply chain analysis plays a key role in equity research
- Elaborates on three types of relative valuation and role of future earnings growth in making an assessment of real value.
Introducing the Stock Market
This section explains how companies list themselves on the stock exchange through IPOs to raise money or to be able to sell theur stakes. Companies may also be delisted if they are acquired, go bankrupt or have financial mismanagement among other reasons. How investors follow stock market through indices which track some selected stocks and it influences investor decisions strongly.
The Nature of Equities
This section delves into the nature of equities and explains how equities are more volatile than bonds since they do not have any fixed income repayments and their growth depends on the performance of the company. Equity owners can benefit in two ways, if the company does well and stock prices go up, and in the form of dividend payments.
This section deals with the complicated subject of equity research which involves industry-level analysis before going on to study various financial projections, revenues, costs, earnings to be able to identify suitable stocks for investments. (Also, checkout Financial Modeling Course)
It explains how what role absolute valuation plays in equity market investments. Absolute vakuation tends to look for short-term tangible ganis over long-term probabilistic gains which could be hard to rely on. It offers an interesting perspective on valuing stocks and deriving their value based on more immediate performance of the company.
Relative valuation more on comparing the company’s current to its historic valuation which leads to a rather subjective and intuitive results than objective ones. This is derived by mutiplying the estimated earnings per share with what investors consider a fair P/E ratio.
Also checkout Price to Book Value,
Bloomberg Terminal Functions for Module 4
Bloomberg Market Concept – Course Fee
- For students, this online course costs only $149 USD, whereas for professionals, it would cost $249 USD.
- Ideally, it takes around 8-12 hours to complete the course and it is recommended to dedicate enough time to understand the contents properly.
Benefits of this BMC Course
- Gaining Familiarity with Key Market Concepts
- Becoming well acquainted with the financial language employed in industry
- Learning with the help of real-world case studies to gain practical understanding
- Understanding key industry benchmarks for professionals
- Mastering more than 70 Bloomberg Terminal functions to become industry-ready
- Receiving a certificate of completion at end of course
Bloomberg Market Concept – Sample Certificate
Below is the sample certificate that you get after completing the Bloomberg Market Concept examination.
source: Bloomberg Institute
Bloomberg Market Concept is fast-paced e-learning course by Bloomberg that provides you with the flexibility to take this exam as and when you desire. This exam provides you with real life case study based learning in Equities, Currencies, Fixed Income and Economics. Additionally, it teaches you with Bloomberg Terminal Functions that are necessary for hands on job in Investment Banking, Equity Research and more.
It is strongly recommended to not take the course lightly and devote enough time to go through the contents and master them to be able to take full advantage in terms of acquiring uAbsolute Valuation Formulaseful knowledge, skills and capabilities.