Transcript Slide 1

EAIR FORUM
COPENHAGEN 2008
Damian Barry
Department of Accounting and Finance
Monash University
Melbourne
Australia
www.monash.edu.au
EAIR FORUM
COPENHAGEN 2008
Developing the Monash Financial
Trading Room
- a learning laboratory for finance
students
www.monash.edu.au
THE TRADING ROOM – a short history
1990: Created with support from large bank: 16 screens. Taught
money market operations and management
1993-2003: Hardware and software upgrades. Single subject only
2003: “Monash Trader” application developed. Joint project with
Faculty of IT. Capacity increased top 30 screens
2006: Upgrade of hardware and new software applications.
Teaching expanded to include financial planning; equities and
securities trading; SAP.
2007: Further technology upgrade and new commercial software
applications
www.monash.edu.au
THE TRADING ROOM - our vision for
this learning laboratory
A STATE OF THE ART TEACHING AND LEARNING
SPACE
USING INFORMATION TECHNOLOGY AND
SOFTWARE APPLICATIONS TO DELIVER LEADING
EDGE FINANCE AND ACCOUNTING EDUCATION and
RESEARCH
www.monash.edu.au
THE TRADING ROOM – what it does
..simulates equity and currency dealing using real
data
..brings theory and practice together
..is state of the art technology
..develops students team work, communication
and love of learning
www.monash.edu.au
SOFTWARE TOOLS
FINANCIALTRADING SYSTEM (FTS)
MONASH TRADER (currency and equities trading)
VISIPLAN (financial planning)
SAP
IniPax (equities, carbon, water trading)
HEDGE RX (2008)
RISK MANAGER (currency trading)
www.monash.edu.au
“MONASH TRADER” – how it works
• Three students act as a bank
• Role of each bank member.
– Dealer
– Risk Manager
– Position Keeper
• Market view
• Strategy for dealing session
• Reasons for this strategy
www.monash.edu.au
Each group (Bank) receives a copy of the economic
scenario one week prior to the trading session
The Simulation Process
– Monash Trader.
Each bank is required to submit a trading report
outlining their key views in advance of the week’s
trading session establishing their strategy.
Trading commences under the control of the facilitator who fills
the role of the central bank, the corporate and the broker. Trading
commences between the banks (inter-bank), the corporate and
the broker. This trading takes place via a telecommunications
system and pricing system developed specifically for the
simulation.
Information is conveyed to all parties electronically in
real time via message boards.
Book-squaring time where banks are required to close out their
positions and profits are computed. Students then complete their
trading report and submit it for assessment as part of a
“reflective” learning process prior to the next simulation.
Repeat
Once
The facilitator
provides a
break in the
middle of the
trading
session to
allow banks to
reflect on their
position and
reassess
strategy.
THE TRADING ROOM – undergraduate
and post graduate teaching
Equities and Investment
Options, Future and other
Derivative Securities
Debt Markets and Fixed
Income Securities
Accounting Information
Systems
Financial Planning
www.monash.edu.au
THE TRADING ROOM – how students
learn - pedagogy or andragogy
• Build on theoretical finance concepts taught in
lecture and seminars
• Application through technology
•Application of technology to all accounting,
banking and finance units wherever possible
www.monash.edu.au
Student learning and development and
the experience..what they say
Linking units together
.used marketing ..pricing strategies and psychological
pricing strategies. ..management knowledge ..
..regarding responsibilities of each position, ..workflow
of the team, ..dealing guidelines. .. Economics to ..
analyse macroeconomic events. .. finance and
accounting”.
www.monash.edu.au
Student learning and development and
the experience..what they say
• The ability to think strategically and apply
knowledge rather than simply rely on
memorisation.
• Learning – structuring own learning
experiences. . active participant in the
learning process.
www.monash.edu.au
Student learning and development and
the experience..what they say
Ethics
I had learnt about ethics in business in many other subjects
but none of them had ever put me in the position to make real
ethical decisions ..Those were decisions in actions and under
pressure- such as whether to take advantage of other banks’
mistakes. ….the most repeated motto “My word is my bond”
and warning “Greed is not good” still echo in my head
sometimes. I consider this experience a priceless realistic
training of ethics.
www.monash.edu.au
Student learning and development and
the experience..what they say
Report Writing.
.. scary for students but turns out to be very useful for
our learning process. Written feedback on a timely basis
helped us be aware instantly of what we know and what we
don’t know, and more importantly what area to develop. We
had the opportunities to try out our new tactics and skills,
examine small failures and receive advice on how to correct
them. This requirement and feedback make a perfect stimulus
pushing us along our learning progress.”
www.monash.edu.au
Student learning and development and
the experience..what they say
Global citizen
“The good thing was that we were mixed with students
from many different countries in the world and we
socialized a lot with them. That prepares us for
performing professionally and socially in an
international and multicultural context. We became
more capable of solving problems in a variety of
locations with cultural and environmental sensitivity”
www.monash.edu.au
THE TRADING ROOM - development
through partnership
•TRADING ROOM DEVELOPED THROUGH A PARTNERSHIP
OF ACADEMICS AND ADMINISTRATIVE STAFF – MUTUAL
DEPENDENCY
•LEVERAGE COMPETENCIES
•ENGAGEMENT and OWNERSHIP
• A WIN-WIN FOR STUDENTS/DEPARTMENT/UNIVERSITY
www.monash.edu.au
THE TRADING ROOM – an exciting
future

Cross discipline teaching and research
Engage with industry - collaborations and
partnership
Differentiate teaching - industry guest lecturers
A second trading room
Behavioural research and training
www.monash.edu.au
THANK YOU … QUESTIONS?
• Dealing room website:
http://www.buseco.monash.edu.au/aaf/research/tdr/
www.monash.edu.au
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