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Learn to use CreditEdge to analyze default risk of public firms through hands-on exercises.

Who Should Attend

    This seminar is targeted to credit professionals who wish to better understand the Moody's Analytics EDF model and its implementation in CreditEdge, so that they can fully utilize it to analyze credit risk of public firms.

Materials

    Participants will receive a training package with presentation materials and reference documents for use during and after the seminar.

    This course, lasting up to a day, is available at client sites only and may be customized to fit client needs.

Learning Objectives

  • Understand the public firm EDF methodology and its implementation in CreditEdge.
  • Understand the relationship between a public firm's capital structure, its market value of equity, and its market value of assets, and how those relationships can be used to calculate its probability of default.
  • Learn how to use CreditEdge to understand the drivers behind a firm's default risk, compare a firm with other firms or peer groups, and complete what-if and pro-forma analyses.
  • Understand the specific inputs and outputs of the public firm EDF model and CreditEdge.
  • Be able to explain to colleagues the material and concepts covered during training.

Topics

  • What is EDF? What causes a firm to default?
  • EDF drivers: market value of assets, asset volatility, and default point
  • Calculating market value of assets: equity as a call option on assets, asset volatility, and default point
  • Combining EDF drivers to calculate distance-to-default
  • Empirically mapping distance-to-default to EDF
  • Hands-on exercises: analyzing EDF, EDF history, and EDF drivers; comparing a firm with other firms and peer groups; what-if analyses, pro-forma analyses