TRADING WITH SECURITIES, THEIRACCOUNTING AND SETTLEMENTS

Volume of the course: 4 credits.

Goals and intended skills: To allow the students to advance their knowledge of origins of securities, aspects of trade in and accounting of securities, significance of securities in general financial system. To educate skills of securities trade and accounting, to dorm investment strategies, to analyse economic processes and place, to identify and substantiate investment purposes and instruments for their achievement.

Brief annotation: Investments to securities gain popularity, and understanding of basics of such investment activity becomes increasingly important in contemporary financial system. History of emergence of securities trade, creation of securities exchange markets, aspects of trade system functioning in Lithuania and abroad. Trading in securities is integrally linked with their accounting, which is based on accounting standards and general notion of accounting. The course discloses specific features of securities trading and accounting, practical basic knowledge of the subject is granted.

Topics: Introduction. History of appearance of stock exchange markets, comparative characteristics of stock exchanges (3 hours of lectures and 3 hours of seminars). Stock exchange and non-stock exchange trading. Analysis of legislative frameworks regulating the trade (2 hours of lectures and 2 hours of seminars). Members of stock exchange. Analysis of legislative framework regulating status of stock exchange member. Description of differences between resident and non-resident members of stock exchange (2 hours of lectures and 2 hours of seminars). Lists of securities trade. Analysis of legislative framework regulating what can be traded in stock exchange. Analysis of trade parameters published by Vilnius Stock Exchange (2 hours of lectures and 2 hours of seminars). Types of assignments to Vilnius Stock Exchange. Analysis of legislative framework regulating how trade can take place in stock exchange (2 hours of lectures and 2 hours of seminars). Price establishment mechanism in Vilnius Stock Exchange. Analysis of legislative framework regulating price establishment mechanism. Task solution. (2 hours of lectures and 2 hours of seminars). Review of investors structure. Data analysis according to selected criteria (residents/non-residents, countries, types of securities) (2 hours of lectures and 2 hours of seminars). Introduction to the securities accounting in general accounting system (3 hours of lectures and 3 hours of seminars). Legislative documents regulating accounting. Review of legislative framework, major legislation (2 hours of lectures and 2 hours of seminars). Systems of settlements and transfers of securities. Analysis of legislative framework regulating these systems. Comparative analysis of systems of international settlements and accounting systems (2 hours of lectures and 2 hours of seminars). Central Securities Depository of Lithuania. Its place in the national system of accounting and settlements, main functions (4 hours of lectures and 4 hours of seminars). Enterprises of financial brokers, establishment and activities. Analysis of legislative framework regulating activities of EFB(2 hours of lectures and 2 hours of seminars). Types of enterprises of financial brokers. Comparative analysis of legislative framework regulating types of EFB according to investment services provided (4 hours of lectures and 4 hours of seminars).

Content of practical training: The course includes investment simulation game created by the lecturer and students, where under conditions similar to actual ones trade in securities takes place in Vilnius Stock Exchange, including their accounting; the game is administered by lecturer of the course.

Teaching methods: lectures, seminars, reports, colloquia, analysis of specific situations and tasks, decisions in academic groups, investment simulation game.

Attendance requirements: attendance of lectures is not and attendance of seminars is mandatory.

Procedure for assessment of knowledge and skills: examination. Accumulative assessment score: 60% examination, up to 40% activity in seminars and results of colloquia.

Requirements: master students must have attended courses of microeconomics and macroeconomics (or theory of economics).

Coordinating lecturers: Prof. Hab. Dr. A. Buračas, lect. P. Vaičiulis

Recommended Literature:

No. / Edition
date / Authors and title of publication / Publishing house / No. of copies in University library
1. / 1996 / The Future for the Global Securities Market:legal and regulatory aspects/edited by Fidelis Oditah The Oxford law colloquium / Oxford:Clarendon Press,1996 / 1
2. / 2006 / Investuotojo ABC:iliustruotas žinynas apie akcijas, palūkanas, išvestinius finansinius instrumentus, investicinius fondus, pinigus [Investor's ABC: Illustrated Manual on Shares, Interests, Derivative Financial Instruments, Investment Funds and Money], Matias Sundling and Samir Kamal / Vilnius:Verslo žinios,2006 / 1
3. / 2007 / Property in securities:a comparative study/Eva Micheler Cambridge studies in corporate law / Cambridge:CambridgeUniversity Press,2007 / 1
4. / 1995 / Securities Institute (services) Ltd. An introduction to international capital markets (module one). / London 1995 / E-version at the lecturer
5. / 1995 / Securities Institute (services) Ltd. An introduction to international capital markets (module two). / London 1995 / E-version at the lecturer
6. / 1995 / Securities Institute (services) Ltd. An introduction to international capital markets (module three). / London 1995 / E-version at the lecturer
7. / 2004 / An Arbitage Guide to Financial Markets/ Robert Dubil / John Wiley&Sons Ltd, The Atrium, Southern Gate, Chichester, West Sussex, England / Hard copy at the lecturer
8. / 2005 / Vault career guide to investment banking/ Tom Lott, Derek Loosvelt / Vault Inc. USA / Hard copy at the lecturer
9. / 2001 / How to think like B.Graham and invest like W.Buffett/ Lawrience A.Cunningham / McGraw-Hill / Hard copy at the lecturer
10. / 2005 / Fixed-income securities and derivatives handbook/ M.Choudhry / Bloomberg Press Princeton / Hard copy at the lecturer
11. / 2003 / Financial management and analysis. Second edition./ F.J. Fabozzi P.P.Peterson / John Wiley&Sons Inc, Canada / Hard copy at the lecturer
12. / 2004 / A modern Approach to Gradham and Dodd Investing/ Thomas P. AU, CFA / John Wiley&Sons Inc, Canada / Hard copy at the lecturer
13. / 2005 / Asset and risk management/ L.Esch, R.Kieffer, T.Lopez / John Wiley&Sons Inc, England / Hard copy at the lecturer

Useful websites:

  1. Central Securities Depository of Lithuania -
  2. International accounting standards, history of accounting -
  3. Vilnius Stock Exchange -
  4. Search for legislative information -
  5. Financial terms, thematic articles (encyclopaedia) -
  6. Theory and practice, summary and analysis (finance) -
  7. Dictionary of financial terms, articles -
  8. Dusseldorf Stock Exchange -

Prof. Hab. Dr. A. Buračas, lect. P. Vaičiulis