ACI Dealing Certificate Examination Preparation Course

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Course Objective

The ACI Dealing Certificate is a foundation program that allows candidates to acquire a working knowledge of the structure and operation of the major foreign exchange and money markets, including the ability to apply the fundamental mathematics used in these markets, and their core products (cash, forwards and derivatives), and the basic skills required for competent participation, including the ability to apply the fundamental mathematics used in these markets.

This course covers foreign exchange, cash money markets and interest rates, exchange rate and interest rate derivatives, asset and liability management, risk management and a code of conduct ('The Model Code').

Course highlights include:

  • The principles of the time value of money
  • The functions of the money market
  • The basic principles and functions of the foreign exchange market
  • The mechanics of interest rate derivatives and their use in hedging interest rate risk
  • The fundamentals of options
  • The fundamentals of asset and liability management and risk management
  • The principles and importance of the Model Code


Preparation for the examination consists of a five day training programme, with course notes, hand-outs, worked examples and case studies, followed by a full mock examination

  • NB: The ACI Dealing Certificate is a valuable training programme even if participants do not wish to take the ACI examination – the exam is NOT compulsory as a part of the training course
  • Participants who do not feel confident about mathematical calculations (of which there are some in this examination) can be reassured by the fact that any formulae required to perform calculations are provided for the examination – they do not need to be learned 'by heart'


Who should attend

This course is ideally suited for:

  • New entrants and junior dealers, with approximately 0 – 4 years of experience, in the dealing rooms of international investment and commercial banks, Central Banks, Ministries of Finance, etc
  • Middle office, back office and operations personnel who need a greater understanding of the products and markets their front office colleagues trade in
  • Fund managers, investment managers and advisers who wish to acquire a greater mathematical understanding of the financial markets
  • Accountants, auditors, regulators, inspectors and compliance officers requiring a better understanding of the financial markets


Do you have five or more people interested in attending this course? Do you want to tailor it to meet your company's exact requirements? If you'd like to do either of these, we can bring this course to your company's office. You could even save up to 50% on the cost of sending delegates to a public course.

To find out more about running this course in-house:

Our Tailored Learning Offering

If you want to run this course at a location convenient to you or if you want a completely customised learning solution, we can help.

We produce learning solutions that are completely unique to your business. We'll guide you through the whole process, from the initial consultancy to evaluating the success of the full learning experience. Our learning specialists ensure you get the maximum return on your training investment.


We can offer any of our public courses delivered at your office or we can devise completely tailored solutions:

Read more about our offering or complete a call back request to speak to a learning specialist.



Day 1 - Basic Interest Rates and Cash Money Markets

The principles of the time value of money, including

  • Calculating short-term interest rates and yields, including forward-forward rates
  • Using interest rates and yields to calculate payments
  • Evaluating alternative short-term funding and investment opportunities

Yield curves and their significance, including

  • The terminology describing the overall shape of and basic movements in a curve
  • The classic theories which seek to explain changes in the shape of a curve
  • Plotting a forward curve and understand the relationship between a yield curve and forward curves.

Interest rate calculations, including

  • Present value and future value using the arithmetic techniques of discounting and compounding for money market instruments
  • Simple interest using different day count and annual basis conventions for the euro, sterling, Swiss franc, US dollar and Japanese yen
  • Same-day, next-day, spot and forward value dates, and maturities under the modified following business day convention and end/end rule
  • The conventional frequency and timing of payments by cash money market instruments, including those with an original term to maturity of more than one year
  • Broken dates and rates through linear (straight line) interpolation
  • Conversion of interest rates and yields between money market basis and bond basis, and between annual and semi-annual compounding frequencies

Terminology and definitions, including

  • Pure Expectations Theory
  • Liquidity Preference Theory
  • Market Segmentation Hypothesis

Sale and Repurchase Agreements (“Repo), including

  • The differences and similarities between classic repos and sell/buy-backs in terms of their legal, economic and operational characteristics
  • Definition of initial margin and margin maintenance
  • The main types of custody arrangements in repo
  • Calculating the value of each type of instrument using quoted prices, including the secondary market value of transferable instruments
  • Calculating the present and future cashflows of a repo given the value of the collateral and an agreed initial margin
  • Definitions of general collateral (GC) and specials
  • Procedure when income is paid on collateral during the term of the repo, in an event of default and in the event of a failure by one party to deliver collateral


Day 2 - Foreign Exchange

Basic spot FX dealing, and its terminology and practice, including

  • Recognising the principal risks in spot and forward FX transactions
  • Calculating and applying forward FX rates, and understanding how forward rates are quoted
  • Understanding the relationship between forward rates and interest rates
  • Understanding time options
  • The mechanics of outright forwards, FX swaps and forward-forward FX swaps
  • The use of FX swaps in rolling spot positions, hedging outright forwards, creating synthetic foreign currency assets and liabilities, and in covered interest arbitrage
  • Understanding of the rationale for non-deliverable forwards (‘NDFs)
  • Recognising and using quotes for precious metals
  • The structure and operation of the international market in precious metals

Principles of FX dealing, including

  • Identifying base currency and the quoted currency in standard exchange rate notation, and selecting which currency should be the base currency in any currency pair
  • Recognising the ISO codes for the currencies of the countries affiliated to ACI – The Financial Markets Association
  • Distinguishing between the “big figures” and the “points/pips”
  • Applying a bid/offer spot exchange rate as price-maker and price-taker to convert either a base or quoted currency amount
  • Selecting the best of several spot rates for the buyer or seller of an amount of base or quoted currency
  • Understanding basic spot FX dealing terminology as explained in The Model Code
  • Calculating cross-rates from pairs of exchange rates
  • Calculating and explaining the reciprocal rate of an exchange rate
  • Defining the function of market-making and explain the incentives to make markets and the particular risks of market-making
  • Outline what a voice-broker does and distinguish voice-brokers from principals
  • The roles of automatic trading systems (ATS) or electronic brokers in spot FX

Calculations and definitions, including

  • Forward FX rates from spot FX rates and interest rates
  • Outright forward FX rates from spot rates and the forward points
  • Short-dated swaps and outrights, and their application in rolling over spot positions
  • The relationship between the outright forward rate, the forward points, the spot rate and interest rates, including interest rate parity and covered interest arbitrage
  • Calculating forward value dates for standard periods
  • The structure and mechanics of an FX outright, and how an outright forward can be hedged with a spot transaction and deposits

Day 3 - Derivatives and Options

FRAs, money market futures and swaps, including

  • The advantages of derivatives
  • The mechanics and terminology of FRAs
  • How FRAs can be used to hedge interest rate risk
  • The mechanics and terminology of money market futures
  • How money market futures can be used to hedge interest rate risk
  • The principal differences between OTC instruments exchange-traded instruments
  • How a futures exchange and clearing house works
  • The mechanics and terminology of money market interest rate swaps, including overnight indexed swaps (OIS)
  • How swaps can be used to hedge interest rate risk
  • How money market futures can be used to hedge and price FRAs and money market swaps

Options and their uses, including

  • Definition of an option
  • Comparison with other instruments
  • Definition of strike price, market price, the underlying, premium and expiry
  • Calculating the cash value of a premium quote
  • How OTC and exchange-traded options are quoted, and when a premium is conventionally paid
  • Definition of call and put options
  • Pay-out profiles of long and short positions in call and put options
  • Define the intrinsic and time values of an option, and identify the main determinants of an option premium
  • Explain what is meant by in the money, out of the money or at the money
  • Dfine the delta, gamma, theta, rho and vega
  • Interpret a delta number
  • Outline what is meant by delta hedging

Day 4 - Principles of Asset/Liability Management (ALM), Risk Management and ‘The Model Code’

The meaning and the general concepts of ALM and risk management, including

  • The main risk factors on the asset and the liability side of the balance sheet
  • The impact and importance of market risk, interest rate risk, currency risk, liquidity risk and credit risk

Understanding market risk, including

  • Types of market risk (Interest Rate, Equity, Currency, Commodity)
  • The use of Risk Measures: key concepts of Value at Risk (holding periods, confidence levels, VaR calculation, Limitations of VaR, Expected Shortfall)
  • The use of quantitative techniques (Risk Factors and Loss Distributions, Variance-Covariance Method, Historical Simulation , Monte Carlo)
  • Limit structures in the dealing room

Understanding credit risk, including

  • Categories of credit risk, including lending, issuer, settlement, counterparty credit risk
  • Managing credit risk, including limits and safeguards, credit approval authorities and transaction approval process
  • Aggregating exposure limits by customers, sectors and correlations
  • Documentation: covenants, ISDA / CSA and other collateral
  • Fundamentals of credit risk capital measurement
  • Capital treatment of credit risk under Basel III

Understanding operational risk, including

  • Sources of operational risk: systems, people, processes and external events
  • Reasons for banks to control operational risk: legal and regulatory requirements
  • Best practice management procedures
  • Legal, regulatory and reputation Risk:

Understanding liquidity risk, including

  • Objectives and importance of a funding strategy
  • Lessons learned from crises in liquidity risk management
  • Liquidity coverage ratio and net stable funding ratio

The Model Code and market practices, including

  • The scope of the Model Code
  • The need for high standards of integrity, conduct and professionalism
  • Monitoring and control mechanisms employed to protect individuals and their institutions from undue risks and resultant losses.
  • Applying the market practices covering trading in:
    • Foreign exchange
    • Money market
    • Derivatives
  • Employing the best market practices concerning dealing with:
    • Customers
    • Voice brokers
    • Electronic broking platforms
    • Prime brokers
    • Operations

Day 5 - Mock Examination, including marking and revision

Why us

We have a combined experience of over 60 years providing learning solutions to the world’s major organisations and are privileged to have contributed to their success. We view our clients as partners and focus on understanding the needs of each organisation we work with to tailor learning solutions to specific requirements.

We are proud of our record of customer satisfaction. Here is why you should choose us to help you achieve your goals and accelerate your career:

  • Quality – our clients consistently rate our performance ‘excellent’ or ‘outstanding’. Our average overall score awarded to us by our clients is nine out of ten.
  • Track record – we have delivered training solutions for 95% of worlds’ top 100 banks and have trained over 250,000 professionals.
  • Knowledge – our 150 strong team of industry specialist trainers are world leading financial leaders and commentators, ensuring our knowledge base is second to none.
  • Reliability – if we promise it, we deliver it. We have delivered over 20,000 events both in person and online, using simultaneous translation to delegates from over 180 countries.
  • Recognition – we are accredited by the British Accreditation Council and the CPD Certification Service. In an independent review by Feefo we scored 96% on service and 95% on product