Need help with HSBC Interview
Discussion
Hi Guys,
I have an interview soon for a fund accounting role and the email states I should "ensure that I am very familiar with HSBC Security Services and the business that we operate in."
What I would like to know is if firstly anyone from here can give me some advise that works in HSBC for the interview format and also what are security services.
I have read up quite a lot online however I can't seem to get a feel for exactly what it is...
any help would be great !
I have an interview soon for a fund accounting role and the email states I should "ensure that I am very familiar with HSBC Security Services and the business that we operate in."
What I would like to know is if firstly anyone from here can give me some advise that works in HSBC for the interview format and also what are security services.
I have read up quite a lot online however I can't seem to get a feel for exactly what it is...
any help would be great !
It's also worth reading their web site about it too, assuming you haven't already - http://www.hsbcnet.com/gbm/products-services/secur...
Hi Yajeed,
I was actually on the website and it was a little vague, the other companies mentioned by bompey really helped.
so I guess what would be good to get a real life on the job persons view point of what the following is - I am happy enough to read up what they are theoretically for fund administration
Valuations
Fund pricing processes
NAV
Accrual Processing
Any specific Accounting/regulatory standard's that really stand out in this area .
Thanks
I was actually on the website and it was a little vague, the other companies mentioned by bompey really helped.
so I guess what would be good to get a real life on the job persons view point of what the following is - I am happy enough to read up what they are theoretically for fund administration
Valuations
Fund pricing processes
NAV
Accrual Processing
Any specific Accounting/regulatory standard's that really stand out in this area .
Thanks
I don't actually know much about HSBC (or fund accounting for that matter!) but I do work at a hedge fund.
Anybody who actually works in either of the above might be able to correct me on some of the below, but I think it should give you a n OK overview of what each means.
Valuations
Funds all have valuation points (VP), which is a point in time where the fund's NAV (net asset value, or current value) is struck (or calculated). Some funds have daily VPs (funds aimed at retail investors and UCITS funds mostly I believe) and some can be monthly (your more traditional hedge funds are more likely to have a monthly VP).
At the valuation point the value of all of the positions in the fund are calculated using the latest available price and the total value of the fund (in its base currency) is divided by the number of units (read as shares) in issue to obtain the unit price. (In practice this is usually more complicated with many funds have multiple share classes in different currencies). This unit price is what it will cost investors to buy or sell their share in the fund.
Valuing positions is usually fairly straight-forward (dependent on asset type), for example the value of any cash is just converted into base currency and added to the totals. The value of an equity is usually just (Quantity*Price) converted into the base currency of the fund. For Fixed Income (bonds) we have to start thinking about accrued interest and for most derivatives (futures, swaps, forwards) we'd be looking to calculate the current mark-to-market PnL as the value of the position.
An accrual is a transaction that has been put into the NAV calculation but not necessarily actually been paid in/out of the fund. Examples of this are income (ie dividends). When an equity goes ex-dividend (this means that the holder of the stock on the ex-divided date will receive the dividend, and from then on the stock would be sold "excluding dividend") its price drops by roughly the value of the dividend. It is not unusual for stocks to go ex 3-6 months before the dividend is actually paid, so if we didn't accrue for the dividend the value of the fund would drop between the ex-dividend and payment date.
Other examples of accruals are fees. Fund management co's charge the fund a fee for management, this is usually around ~1.5% a year and paid monthly (paid from the fund itself to the fund management co). To stop the fund dropping by 0.125% at the end of each month (1.5% divided by 12 months) the fee will be accrued daily but the money transferred only monthly.
In terms of fund pricing processes, I'd try and read about single/dual priced funds. Unfortunately my knowledge isn't too hot in these areas, but basically a single priced fund costs an investor the same to buy and sell. A dual priced fund has a different price depending on whether or not you are investing/divesting.
For regulatory standards, I'd have a quick read into the UCITS (with ucits IV being the latest IIRC) framework.
HTH (I think I've rambled on a bit). Let me know if you have any specific questions and I'll do my best to elaborate.
Anybody who actually works in either of the above might be able to correct me on some of the below, but I think it should give you a n OK overview of what each means.
Valuations
Funds all have valuation points (VP), which is a point in time where the fund's NAV (net asset value, or current value) is struck (or calculated). Some funds have daily VPs (funds aimed at retail investors and UCITS funds mostly I believe) and some can be monthly (your more traditional hedge funds are more likely to have a monthly VP).
At the valuation point the value of all of the positions in the fund are calculated using the latest available price and the total value of the fund (in its base currency) is divided by the number of units (read as shares) in issue to obtain the unit price. (In practice this is usually more complicated with many funds have multiple share classes in different currencies). This unit price is what it will cost investors to buy or sell their share in the fund.
Valuing positions is usually fairly straight-forward (dependent on asset type), for example the value of any cash is just converted into base currency and added to the totals. The value of an equity is usually just (Quantity*Price) converted into the base currency of the fund. For Fixed Income (bonds) we have to start thinking about accrued interest and for most derivatives (futures, swaps, forwards) we'd be looking to calculate the current mark-to-market PnL as the value of the position.
An accrual is a transaction that has been put into the NAV calculation but not necessarily actually been paid in/out of the fund. Examples of this are income (ie dividends). When an equity goes ex-dividend (this means that the holder of the stock on the ex-divided date will receive the dividend, and from then on the stock would be sold "excluding dividend") its price drops by roughly the value of the dividend. It is not unusual for stocks to go ex 3-6 months before the dividend is actually paid, so if we didn't accrue for the dividend the value of the fund would drop between the ex-dividend and payment date.
Other examples of accruals are fees. Fund management co's charge the fund a fee for management, this is usually around ~1.5% a year and paid monthly (paid from the fund itself to the fund management co). To stop the fund dropping by 0.125% at the end of each month (1.5% divided by 12 months) the fee will be accrued daily but the money transferred only monthly.
In terms of fund pricing processes, I'd try and read about single/dual priced funds. Unfortunately my knowledge isn't too hot in these areas, but basically a single priced fund costs an investor the same to buy and sell. A dual priced fund has a different price depending on whether or not you are investing/divesting.
For regulatory standards, I'd have a quick read into the UCITS (with ucits IV being the latest IIRC) framework.
HTH (I think I've rambled on a bit). Let me know if you have any specific questions and I'll do my best to elaborate.
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