Practical Work on Corporate Finance (Helpful for BAT / CFA L1 Exam Prep/VBA for finance)

Advisory on Corporate Finance Matters:

• Peers in the same sector (Sectors Industry). 
• MLR - Some Return/Leverage effects multiple.
• Projecting balance sheet 4-5 years.

Top 3 Banks in USA - JP Morgan, Goldman & BOA.

Important Topics:

1. Interest Rate Movements - Fixed vs. Floating.
2. Convertible dept.
3. Tactical Share Repo.

Balancing Complexity with Simplicity:

Advisory - Keeping things simple is most Important.

• —  What we want to run (not using C# or R):

1. MLR – Linest &
2. MC – 1000 paths.
3. Rank Correlation.
4. Choskley – Eigen values.

• Financials of a company?
• Options? Excel vs VBA vs R – Everyone should be able to decript?
• What adds complexity in Excel? Mastery of data tables – support from VBA and not running it from VBA.
• What are we dealing with? Scale 50 data tables, 20 MB file, 1000 paths of many fundamental process. 

 

Sell Side Investment Banking US - Quant Corporate Finance:   

• —  Functions:

1. Advisory on Optimal Leverage – levered repo.
2. Forecasting companies financials.
3. Sensitivity analysis – forecasting with fixed Multiple.
4. MLR and regression with non stationary elements.

Monte Carlo Simulation - How to use Monte Carlo Simulation in quant corporate finance environment:

• Use data tables.
• Do in excel validate through R – Install R packages.
• Pull automated values using formulas of CIQ or Fact set.
• VBA toolkit for MC engine in Excel – Join split – Indexing – Choskley transform. 

Interest Rate Dynamics for QCF:

•  LIBOR & 3ML & 10 UST.
• Trend and modeling perspective.
• Fixed vs. floating – why balance sheet projections become important here?
• Swap rates – where to pull – bloomberg / CIQ / compustat. 

Contributions in Sectors:

• —  Does contribution of growth differs? Why tech has max contribution of growth and defense least – why return has most contribution in return in defense?
• EV/EBITDA for sectors how much things contribute in them.
• List of EV/EBITDA multiple for all companies – what does trend show.
• Regimes to regress EV/EBITDA and what are indicators of regime change.

Areas of Discussion:

• —  REGRESSION ANALYSIS – Coeff – contribution – p value - r-sq.
• SURPLUS CASH – projections – cost - utilization.
• PEER ANALYSIS – GRAPH Theory?
• TRANSFORM during Regression. 

VBA Toolkit:
 

• —  VBA programs to make it work in Excel.
•  Shutting and reactivating data tables.
• 3^rd dimension to data tables by split join.
• Segregating risk or risk attributions.

Contact Us: info@qcfinance.in / contactus@qcfinance.in

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