MiFID II - Investment Funds (EN)

This module is part of the MiFID II Certification.

Based on the ISO definition of an investment fund specifying that an investment fund is a collective investment scheme based on a diversified portfolio of assets that is managed by a professional fund manager, the content of module 6 focuses on:

• Main characteristics of investment funds (based on ISO 10962)
• Types of investment funds - Traditional “long only” funds (in Europe, UCITS funds), hedge funds, private equity funds, real estate funds, exchange-traded funds, funds of funds, pension funds, others
• Attributes of investment funds - Open end/closed end funds, liquid assets/illiquid assets, asset type, level of regulation, incorporated/unincorporated, domicile, active/passive management, alternative management
• Pricing of investment funds - NAV, negotiated price (ETFs)
• Factors influencing the performance of investment funds - Price of the underlying assets, costs/revenues of the fund, leverage, performance of the fund manager, market situation
• Costs associated with transactions and services involving investment funds - Sales charges (subscription/redemption fees), performance fees, administration fees, other fees (e.g., switching fees), commissions
• Structure of the market for investment funds
• Types of markets (regulated, OTC) - Direct subscriptions/redemptions with the fund (through a distributor and the transfer agent), organised markets (exchanges, MTF, OTF, SI) for ETFs
• Primary and secondary markets - Launching a fund (open- end/closed-end), primary market for funds on exchanges (primarily ETFs), normal fund operations (subscriptions/redemptions)
• Market players - Fund manager, distributor, fund administrator (includes fund accountant, transfer agent, domiciliary agent), custodian/depositary, exchange and brokers (for ETFs), paying agent
• Financial instruments as investments
• Market practice - Instrument with wide range of risk (from UCITS to hedge funds), collective investment, economies of scale, long-term savings instrument, low volatility, low fees
• Main risks - Market risk, liquidity risk, credit risk, operational risk
• Tax aspects - Withholding tax, capital gains tax, tax reclamation, subscription tax
• Market forces that impact performance - Price of the underlying assets, volatility, liquidity, interest rates, currencies, macroeconomic factors
• Understanding instrument’s performance - Value of the underlying assets, performance of the fund manager, costs/revenues of the fund, market perspective, volatility
• Documentation related to the instrument - Prospectus (or offering/information memorandum), KIID, PRIIP, terms and conditions, fact sheets

Experienced professional specialists selected on the basis of their in-depth knowledge of marketsand financial products under MiFID rules I and II, and ESMA criteria.