The newly established Financial Research and Trading Lab at IIM Calcutta has definitely created a lot of interest among the various stakeholders. To know more about this initiative, we at Jokatimes interviewed our renowned faculty, Mr. Ashok Banerjee of the Finance and Control Group, IIM Calcutta.

What was the idea behind setting up a Financial Research and Trading Lab?

There were three main factors which inspired us to set up this lab. Firstly, the feedback from the students who had their summer internship in an Investment bank indicated that a finance lab would equip them with necessary practical skills ““ to supplement the theoretical learning. For example, the knowledge of operating a Bloomberg terminal and real time trading would go down well with the theoretical concepts learnt. The second inspiring factor was the fact that most of the reputed business schools across the globe have finance and trading lab. Thirdly, the idea of setting up such a facility was discussed within the Finance and Control group for some time.

What are the objectives of the Financial Research and Trading Lab?

There are five main objectives that we have set to achieve by this lab.

1.      To give cutting edge tools to understand financial markets, especially the Indian financial markets. For example, we have introduced a new course “Trading Strategies” in Term IV (Offered from 2009-2010 academic year)

2.      To enable research. For example there is a possibility of having a cross functional research on the effect of information on financial markets, an area of interest to both MIS (Management Information Systems) group as well as Finance and Control group.

3.      To use this lab as a testing platform for our designs. For example, you can design a trading strategy and test it ““ without involving real money, but using real, live data.

4.      To conduct training programmes ““ The knowledge that is developed can be transferred to both the corporate and the student community. We had a workshop “Optimization methods and Financial application” in March 2009.

5.      Finally, this is a platform for holding events like national and international conferences.

An International Conference during 3^rd to 5^th December is going to be held to commemorate the first anniversary of setting up this lab. We have already received confirmations from top notch financial experts all over the world. We want to make this an annual event from there on.

What are the facilities and special features of this Financial Research and Trading Lab?

Currently we are getting live data (without any kind of lag) from five financial markets in India ““ NSE Cash, NSE F&O, MCX, BSE Cash and NCDEX. We have a simulator, to which this live data is fed so that we can test our designs on this live data. All the features and options provided in these terminals are exact replicas of what the brokers use. All this would augment what the student learns through the regular courses.

Can you tell us more about the new course “˜Trading Strategies’?

We already have a course on Investment Analysis and Portfolio Management (IAPM). Here you would learn trading strategies, how to manage a portfolio etc. However, as a trader you would mostly be required to make intraday decisions ““ based on inflow of information and technical analysis. This new course on “˜Trading Strategies’ ““ which would be taught fully in the lab, will help the student make those crucial intraday decisions.

What kind of software suites are being used in this Financial Research and Trading Lab?

Apart from the simulation software that is available on all the 48 terminals and the Bloomberg terminal, we are in the process of getting a cutting edge analytical tool. We are also considering the addition of more “˜Bloomberg type’ terminals ““ more specific for use in the Indian market like CNBC terminals. Apart from all these software suites, there are also some specific add-on applications that we are looking at.

Three of our Alumni from the IIM Calcutta Class of 2009 also share their views on how the Financial Research and Trading Lab is going to benefit the student community.

The Finance Lab at IIM C is a great initiative by the institute to help students apply theoretical finance concepts to practical issues of the finance world. The lab gives students the access to hard to find real time data and a platform of applications to test their theories. From my personal experience the learning curve is very steep during internship and using up say 2 weeks out of 8 for getting a hang of the Bloomberg machine can make things really tight. Hence, I see this as an opportunity for IIMC’ians to hit the ground running in their internship stints with financial institutions. I’m sure this facility is going to add more value to student seeking any financial career.

C Abhijit 

(Interned with DSP Merrill Lynch Mumbai, Debt Trading, Fixed Income Currencies and Commodities Desk)

I did my internship in Merrill Lynch Hong Kong in the Exotic Derivatives Trading Division. My work included extensive use of Bloomberg, Reuters and Microsoft Excel. With the help of a training program (from Merrill Lynch), I got used to Bloomberg and Reuters in a week’s time. Since my internship lasted just 8 weeks, 1 week is really important. I’m glad that students from the current year are armed with Bloomberg training even before the internship begins. This can help them to perform better in the internship and secure that coveted PPO. The new Finance lab can also be used to provide new courses that can be very practical and useful in the career perspective. 

 

M. Natrajan 

(Interned with Merrill Lynch Hong Kong, Exotic derivatives Trading Division)

 For people who are seriously looking at a career in finance especially in the investment banking space this unique facility at IIM C is another reason to choose IIM C. The highly learned and experienced faculty now has at their disposal another tool to share their knowledge and students can test out ideas immediately which very few finance programs in the world offer. It’s also going to be a center of frontline research and the ideal place for getting to know the groundbreaking work taking place in the world of finance.

 Srikrishna Swaminathan 

(Interned with Merrill Lynch Mumbai, Investment Banking Division – Real Estate and Infrastructure Group)

 For Jokatimes
Guhan M