Closely following the current financial crisis and its impact on the financial markets across the globe, IIM Calcutta has realized that this crisis is largely the result of managers not being able to completely understand and manage the operational risks of the new generation of derivatives.
With a mission of supporting advanced applied research in financial markets and equip finance managers with the mathematical and conceptual theories and best practices in financial markets that go into the creation and management of innovative financial products, IIM Calcutta is coming up with a state-of-the-art Finance Laboratory, called Financial Research & Trading Lab(the Lab). The setting up of the Lab as a research laboratory on financial markets, in this period of crisis is thus very relevant. The lab builds on the traditional strengths of IIM Calcutta in the Finance and Quantitative Methods areas.
Currently, the Lab will have 51 terminals with trading simulator and data from five markets (NSE Cash and F&O, BSE Cash, NCDEX and MCX) and one Bloomberg terminal with plans to include real time data of other financial markets like Money Market, Currency etc and some more software like Revenpack NewsAnalytics, Optirisk Optimization Suite etc.
IIM Calcutta's Financial Research and Trading Lab will be the first of its kind among the IIMs and will give an opportunity to students, faculty and Executive Education participants to test financial models with live financial information from all the major sources from around the world NSE, BSE, MCX, NCDEX, Bloomberg, etc.
The Lab will provide students hands-on data analysis and modeling experience through access to real time national and international financial data, market information, business news and cutting edge financial analysis software. New methods of teaching will use live market information to test market hypotheses. Some example of this are: the estimation of latency ratio to test market efficiency, intra-day market behaviour, algorithmic trading and its associated risks, and co integration of financial markets. This allows the training of tomorrow's financial managers to take informed decisions. It would also support and enhance academic research with the availability of extensive historical and real time data. The Lab will provide opportunities for collaborative research and teaching with other functional disciplines such as Operations Management and MIS. The Lab would provide short-term training programmes in contemporary issues in finance such as market pricing, asset liability management, risk management, trading strategies, market microstructure and structured products.
