JBIMS-Mumbai Hosts
Jitendra Marchino of JP Morgan on Campus
In its continued attempt to help
students interface with the industry stalwarts, JBIMS hosted on campus
Jitendra Marchino of JP Morgan for a Session on Derivatives on March
10th, 2008. Mr. Marchino is the Vice President, Future & Options Division at JP
Morgan.
He is also an alumnus of the institute.
Mr. Marchino struck a chord with
the batch immediately with his humorous way of presenting relevant examples to
the batch. At the very outset, he chose to divide the class into Teams of 5, and
involved them in small games, and the conclusions of each of them were related
to relevant concepts in Derivatives.
He started off by stressing on
the fact how each one of us is a part of and is intricately involved with the
stock market, irrespective of whether we directly invest in stocks or not. He
also explained the significance of the stock market movement on the different
functionalities of an organization, which the MBA students may end taking up in
the future.
He explained that the choice of
an investment depends on more than one factor and varies from person to person.
While the market perception may be the criteria for some, others might decide on
the basis of their tenure of investment and expected returns during the period.
To add to this, what also comes into play is the risk taking ability of each
individual.
He went on to explain the concept
of derivatives, but only after an exercise in which the teams were asked to bid
at present for IPL squads based on their perception of the future profitability
of each of the squads. The example more than clarified the meaning of an
underlying, which is the foundation on which all Derivatives instruments are
built.
Not budging from his interactive
and fun-filled way of teaching, he went on to play another small game with the
students, aimed at teaching them how these derivative instruments helped hedge
risks. He then supplemented his explanations with real life examples of ways in
which companies' structure their derivative instruments to hedge risks posed by
internal environment and external market conditions in their operations.
After managing to help the
students find their comfort zone through his unique style of keeping them
involved at all times, he then went on to explain through various examples, how
the market changes in one sector directly or indirectly impact the other
sectors. This is what, he said, is the chief role of people who manage such
derivative instruments. They keep a close watch on various sectors and try to
project the impact of small and big changes / predictions / research on the
other sectors of the economy.
The session was a highly
interactive one and at the same time, of immense learning value to the budding
finance managers present in large numbers. He concluded by suggesting them
various ways in which they could groom themselves to tackle their jobs in the
future. Mere reading is not enough, he said. It is how we apply what we have
read, that is important to make a difference.
