Debt Capital Market (DCM) Sales
Meaning of recommendations
A BUY recommendation means we expect an increase in value of the financial instrument to which this recommendation relates over the specified time period or, if not specified, over the short term.
A SELL recommendation means we expect a decrease in value of the financial instrument to which this recommendation relates over the specified time period or, if not specified, over the short term.
A HOLD recommendation means we believe the market price or value of the relevant financial instrument is at a fair level.
Length of time of the investment to which the recommendation relates
Investment recommendations are normally produced on an ad-hoc basis. Written communications constituting investment recommendations may be distributed on a regular basis e.g. monthly or weekly and information on frequency of distribution will where appropriate be provided in the publication.
Valuation of debt instruments
1. Estimate the expected cash flows.
2. Determine the appropriate interest rate or interest rates that should be used to discount the cash flows versus the risk free rate of return.
The expected cash flow take into account yield, duration and frequency. Additionally credit rating and pricing versus peers could contribute to specific investment recommendations.
Internal organizational and administrative arrangements re conflicts of interest an investment recommendations
Cantor Fitzgerald Europe has internal controls and information barriers set up to separate the public side and private side of the business, including a Chinese wall between the Corporate Finance department and other departments with formal wall-crossing procedures in place. The firm has policies and procedures designed to control conflicts of interest including the Conflicts of Interest Policy, which sets out among other things procedures for mitigating or avoiding conflicts of interest. The firm’s policies and procedures apply to investment recommendations. Front office staffs undertake training on at least a yearly basis in relation to conflicts of interest.
Remuneration of persons involved in producing the investment recommendation
The remuneration of persons involved in the production of this investment recommendation is not directly tied to transactions in services provided by the Corporate Finance department or any other department other than the department for which the person works, although it may be related to the results of the firm as a whole to which other departments contribute.