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Certificate in Commodity Derivatives

The Chartered Institute for Securities & Investment is the principal provider of qualifications for the industry. In particular the CISI has developed a wide-ranging programme of qualifications for individuals working in the securities and derivatives markets. Qualifications offered by the CISI provide firms and their staff with a clear benchmark demonstrating they have acquired the required knowledge to carry out their job roles competently.

Key Features
3 a specialist qualification for professionals wishing to develop their understanding of global commodity markets and commodity derivatives 3 commodity derivatives professionals can now gain a single, integrated qualification that underscores commitment to the commodities sector 3 developed with input from leading UK commodity and commodity derivatives exchanges, accredited training providers, trade organisations, firms and specialist trainers 3 the qualification enhances the technical understanding of management and compliance staff who have responsibility for commodity and commodity derivatives oversight 3 vital concepts and principles are addressed including the creation, pricing, valuation, trading, settling, margining and management of a variety of exchange-traded and OTC commodity derivatives, as well as providing a solid overview of the major underlying commodity markets 3 offers global depth and breadth, with enhanced coverage of investment applications and the complex interactions between risk management and global regulatory requirements

Who should study for the Certificate in Commodity Derivatives?

The Certificate in Commodity Derivatives provides a comprehensive professional education in Commodity-based Derivatives and their underlying markets, and is suitable for specialists engaged in analysing, trading, investment management or compliance oversight in the financial services, commodity and corporate sectors.

Regulatory Approval
FSSC Endorsed

For wholesale firms: The Certificate in Commodities Derivatives features on the new Financial Services Skills Council (FSSC) Recommended List of examinations fulfilling the knowledge component of competence.

Liffe actively encourages training and further professional education and is proud to work with the Chartered Institute for Securities & Investment to support its Certificate in Commodity Derivatives
Ian Dudden Director, Commodity Derivatives Liffe, NYSE Euronext

cisi.org

+44(0)20 7645 0680

clientservices@cisi.org

The certificate in commodity derivatives provides a dedicated professional qualification in commodity derivatives for traders, investors, compliance and risk management. It is a useful qualification for anyone wishing to pursue a career in the commodity markets. The LME fully supports it and feels it will be of great value to market participants
Martin Abbott, Chief Executive, London Metal Exchange

Summary Syllabus

ELEMENT 1 INTRODUCTION TO COMMODITY DERIVATIVES ELEMENT 7 PRINCIPLES OF CLEARING AND MARGIN 7.1 Definition and Purpose of Clearing 1.1 Development of Commodity Market Derivatives 7.2 Margin 1.2 General Principles of Derivatives ELEMENT 2 UNDERLYING COMMODITY MARKETS 2.1 Physical Markets 2.2 Price Discovery in Commodity Markets ELEMENT 3 OTHER RELATED MARKETS 3.1 Other Commodity Markets 3.2 Foreign Exchange Markets 3.3 Money Markets 3.4 Equity Markets 3.5 Bond Markets ELEMENT 4 EXCHANGE TRADED COMMODITY FUTURES AND OPTIONS 4.1 Commodity Derivative Exchanges 4.2 Trading Platforms ELEMENT 5 PRINCIPLES OF EXCHANGE TRADED COMMODITY FUTURES AND OPTIONS 5.1 Commodity Futures Pricing 5.2 Commodity Options Pricing 5.3 Market Transparency, Trade Reporting and Monitoring 5.4 Order/Instruction Flow and Order Type 5.5 Trade Registration ELEMENT 6 PRINCIPLES OF OTC COMMODITY DERIVATIVES 6.1 Concepts and Characteristics 6.2 ISDA Documentation 6.3 Commodity Forwards and Swaps 6.4 Commodity Options 6.5 Market Platforms and Trade Processing ELEMENT 8 DELIVERY AND SETTLEMENT 8.1 Aspects of Settlement 8.2 Exercising Commodity Options

ELEMENT 9 TRADING, HEDGING AND INVESTMENT STRATEGIES 9.1 Commodity Derivative Users 9.2 Futures Spread Trading 9.3 Options Strategies 9.4 Commodity Hedging 9.5 Basics of Hedging Options 9.6 Comparison of Exchange Traded and OTC Hedges 9.7 Structured Commodity Financing 9.8 Applications of Commodity Derivative Strategies

ELEMENT 10 SPECIAL REGULATORY REQUIREMENTS 10.1 Scope of Regulation 10.2 Exchange Rules and Regulations 10.3 Principles Based Regulation 10.4 Dealing with Clients 10.5 Risk Management and Ethics 10.6 International Accounting Standards

cisi.org

The FOA has worked closely with the Chartered Institute for Securities & Investment on the development of its new Certificate in Commodity Derivatives. There is a pressing need for anyone wishing to pursue a career in the commodities sector whether it is in trading, investment, risk management or compliance to have a detailed understanding of these increasingly important markets. This new qualification and the accompanying workbook more than meet that need and we would commend them to anyone interested in the commodities sector.
Anthony Belchambers, Chief Executive, Futures and Options Association (FOA)

+44(0)20 7645 0680

clientservices@cisi.org

How is the qualification delivered?

The qualification consists of the following two units.

Recommended study times:

Commodity Derivatives: 100 hours FSA Financial Regulation /Principles of Financial Regulation: 70 hours

3 Commodity Derivatives: two hour paper consisting

of 100 multiple-choice questions Regulation: 1 hour paper consisting of 50 multiple choice questions OR a regulatory unit appropriate to the local environment Candidates sitting the exam by CBT will be required to answer up to 10% additional trial questions that will not be separately identified and do not contribute to the result. Candidates will be given proportionately more time to complete the test. Each exam can be taken at one of many computer based test (CBT) centres worldwide. CBT is operated by CISIs global partner Prometric. Candidates are able to book an examination to fit in with employment and other commitments. Candidates receive their results when they leave the test centre; the formal certificate for successful candidates is issued at a later date. Over 40,000 CISI qualifications are taken every year at CBT centres worldwide. For a list of centres please visit: cisi.org/cbt

3 FSA Financial Regulation/ Principles of Financial

CISI membership
Candidates receive free student membership on completing the qualification registration form. A candidate who achieves the Certificate in Commodity Derivatives is eligible for Associate membership of CISI (ACSI). To progress to full membership (MSCI) individuals need to have either been an associate member for 6 years or demonstrate four years logged Continuing Professional Development (CPD). To join 40,000 financial practitioners and enjoy the benefits of CISI membership, find out more at: cisi.org/membership

The CISI Certificate Programme

The CISI Certificate programme is a comprehensive range of qualifications designed specifically to meet the requirements of individuals working in the securities and derivatives markets.

Are there any entry requirements & exemptions?

There are no entry requirements. However, there are various exemptions in place for the Regulation units. For a list of exemptions, please visit cisi.org/exemptions

3 3 3 3 3

The Certificate in Commodity Derivatives The Certificate in Securities The Certificate in Derivatives The Certificate in Financial Derivatives The Certificate in Investment Management

How do I register for the Certificate in Commodity Derivatives?

Step 1: Pay a one-off registration fee Step 2: Book your examination/s Step 3: Fill out a Qualifications Registration Form cisi.org/qrf

The Certificate in Corporate Finance, which has its own regulatory and technical units, is also available.

Prices
Visit cisi.org/prices to ascertain current prices.

How can I study for the qualification?

Formal training for the Certificate in Commodity Derivatives will be available through a number of CISI Accredited Training Providers. CISI accredits training providers that demonstrate they deliver high-quality training and support to candidates preparing to sit CISI examinations. To find an ATP near you, visit cisi.org/ATP Self Study Route In addition to, or instead of, formal training, candidates can choose the self-study route. CISI publishes comprehensive workbooks for the Commodity and Regulation units. CISI workbooks offer comprehensive coverage of every area of the syllabus and include end of chapter summaries and sample examination questions to ensure candidates are fully prepared before the examination.

To achieve a CISI Certificate:

3 3 3 3
Technical unit = Securities or Derivatives or Commodities or Financial Derivatives Regulatory unit=

3 Principles 3 3

of Financial Regulation* or FSA Financial Regulation Local regulation paper

CISI

Certificate

* Please note that the CISI recommends Principles of Financial Regulation for employees advising professional clients and FSA Financial Regulation for employees advising retail clients. FSA Financial Regulation offers a more detailed understanding of UK FSA regulation that relates specifically to individual retail client relationships.

The Qualifications and Credit Framework

UK Qualifications Levels 1
foundation
The Foundation Qualification - Introduction to Investment International Introduction to Investment

European Qualifications Framework 2

Membership

wholesale

wealth/retail
Certificate in Wealth Management**

operations

specialists

3
qualifying level
Level 3 Certificates in: Commodity Derivatives* Derivatives** Financial Derivatives* Investment Management* Securities International Investment Management Global Securities

4
Investment Operations Certificate (IOC), formerly known as Investment Administration Qualification (IAQ)** IT in Investment Operations** Certificate in Financial Services for Directors Corporate Finance** Islamic Finance Qualification** Risk in Financial Services Combating Financial Crime

There is a ladder of progression for members of the Institute from

Students

to

Associates

to
Global Financial Compliance Investment Advice Diploma** Level 4 Diplomas in: Derivatives** Private Client Advice** Securities**

Members

and ultimately to

5
Advanced Certificates in: Global Securities Operations
Operational Risk

advanced level

Chartered Members

Level 5 Private Client Advice unit**

and

postgraduate professional level

Diploma units: Bonds & Fixed Interest Markets Financial Derivatives Fund Management Regulation & Compliance

CISI Diploma Certificate in Private Client Investment Advice & Management**

Diploma in Investment Operations

Diploma in Investment Compliance

Chartered Fellows

UK RDR qualification requiring gap-fill CPD.

depending on qualifications gained

CISI Masters in Wealth Management**

1. This column is a guide only. Within the chart, National Qualifications Framework* and Qualifications and Credit Framework** accredited qualifications are marked accordingly. 2. The European Qualifications Framework is an overarching qualifications reference framework that links the qualifications of different countries together.

CERTIFICATE IN COMMODITY DERIVATIVES 09/2009 Chartered Institute for Securities & Investment 8 Eastcheap, London, EC3M 1AE

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