Duration 3 days – 21 hrs
Overview
This training course provides a comprehensive understanding of trading execution and price discovery mechanisms within the Philippine financial markets, focusing on equities, fixed income, forex, and digital asset markets. Participants will learn how trades are executed, how market prices are formed, and the technologies, regulations, and market structures that influence execution quality.
The course also covers PSE (Philippine Stock Exchange) environment, PDEx fixed income markets, BSP policies, trading platforms, liquidity considerations, order types, slippages, and best-execution requirements—making it ideal for traders, analysts, and fintech professionals working with trading systems or market products.
Objectives
- Understand the full lifecycle of trade execution across multiple asset classes.
- Explain how price discovery works in order-driven and quote-driven markets.
- Apply best execution principles to real-world trading scenarios.
- Identify and compare order types, algorithms, and execution strategies.
- Analyze liquidity, volatility, spreads, and market microstructure.
- Interpret market data (Level 1 and Level 2) and use it for execution decisions.
- Understand PH regulatory frameworks for trading (PSE, PDEx, BSP, SEC).
- Evaluate execution performance using TCA (Transaction Cost Analysis).
- Gain practical insights into algo trading, smart order routing, and execution systems.
Audience
- Equities, FX, Fixed Income traders
- Trade operations specialists
- Treasury and investment analysts
- Portfolio managers
- Fintech product managers for trading systems
- Brokerage and financial services professionals
- IT professionals developing trading or pricing systems
- Students and professionals transitioning to trading roles
Pre- requisites
- Basic understanding of financial markets
- Familiarity with trading concepts (recommended but not required)
- Optional: experience with PH markets, brokerage platforms, or trading systems
Course Content
DAY 1 – Trading Fundamentals & Price Discovery
Module 1: Introduction to Trading & Market Structure
- Role of trading in financial markets
- Participants: brokers, dealers, retail, institutional
- Overview of Philippine market landscape
- PSE, PDEx, BSP, SEC
- Market sessions, trading halts, circuit breakers
- Order-driven vs quote-driven markets
Module 2: Price Discovery Fundamentals
- What is price discovery?
- Determinants of price: supply-demand, liquidity, volatility
- Price discovery in:
- Equities (PSE)
- Bonds (PDEx)
- FX (USD/PHP)
- Digital assets
- Order book depth, market depth, Level 1 vs Level 2 data
- Bid-ask spreads and their importance
Module 3: Trading Order Types
- Market, limit, stop, stop-limit, fill-or-kill, IOC, AON
- Conditional orders & advanced order instructions
- Practical PH examples using PSE platform conventions
Module 4: Market Microstructure (PH Setting)
- Order matching rules
- Role of market makers
- Tick sizes and lot sizes (PSE-based)
- Liquidity fragmentation and market depth
- Impact of news, macroeconomic releases, and BSP policy
DAY 2 – Execution Strategies & Performance Analysis
Module 5: Trade Execution Lifecycle
- Pre-trade → Trade → Post-trade flow
- Clearing and settlement (SCCP, PDTC)
- Role of custodians
- Trading platforms: FIX, API-based trading, ATS
Module 6: Execution Strategies
- Manual vs automated execution
- Time-weighted average price (TWAP)
- Volume-weighted average price (VWAP)
- Implementation Shortfall
- Iceberg orders
- Smart Order Routing (SOR)
- Execution algorithms used in global markets
Module 7: Transaction Costs & TCA (Transaction Cost Analysis)
- Explicit costs (fees, taxes, broker commissions)
- Implicit costs (slippage, spreads, market impact)
- PH-specific costs (SCCP fees, PSE fees, DST)
- How to analyze execution quality
Module 8: Risk Management in Trading Execution
- Slippage control
- Volatility management
- Fat-finger errors and circuit breakers
- Use of kill switch & trade controls
Module 9: Technology, Systems & Algo Trading Basics
- Overview of trading systems architecture
- Connectivity (FIX protocol, APIs)
- Low-latency trading concepts
- Algo trading in PH context: limitations & opportunities
- Introduction to machine learning for execution optimization
Module 10: Regulatory & Compliance Requirements (PH Market)
- SEC trading rules
- BSP guidelines for FX trading
- PSE best execution rules
- PDEx rules and OTC trading compliance
- Market manipulation & insider trading red flags
Final Exercise / Case Study
- Analyze real-time order book snapshots
- Calculate spreads, liquidity, execution cost
- Compare different execution strategies for PSE equities
- Role-play trade execution decision-making
- TCA mini-workshop
