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SOUTH AFRICAN QUALIFICATIONS AUTHORITY 
REGISTERED QUALIFICATION: 

Master of Commerce in Risk Management of Financial Markets 
SAQA QUAL ID QUALIFICATION TITLE
97914  Master of Commerce in Risk Management of Financial Markets 
ORIGINATOR
University of Cape Town 
PRIMARY OR DELEGATED QUALITY ASSURANCE FUNCTIONARY NQF SUB-FRAMEWORK
CHE - Council on Higher Education  HEQSF - Higher Education Qualifications Sub-framework 
QUALIFICATION TYPE FIELD SUBFIELD
Master's Degree  Field 03 - Business, Commerce and Management Studies  Finance, Economics and Accounting 
ABET BAND MINIMUM CREDITS PRE-2009 NQF LEVEL NQF LEVEL QUAL CLASS
Undefined  180  Not Applicable  NQF Level 09  Regular-Provider-ELOAC 
REGISTRATION STATUS SAQA DECISION NUMBER REGISTRATION START DATE REGISTRATION END DATE
Registered-data under construction  EXCO 0324/24  2024-07-01  2027-06-30 
LAST DATE FOR ENROLMENT LAST DATE FOR ACHIEVEMENT
2028-06-30   2031-06-30  

Registered-data under construction

The qualification content is currently being updated for the qualifications with the status “Registered-data under construction” or showing “DETAILS UNDER CONSTRUCTION” to ensure compliance with SAQA’S Policy and Criteria for the registration of qualifications and part-qualifications on the National Qualifications Framework (NQF) (As amended, 2022). These qualifications are re-registered until 30 June 2027 and can legitimately be offered by the institutions to which they are registered.

 

In all of the tables in this document, both the pre-2009 NQF Level and the NQF Level is shown. In the text (purpose statements, qualification rules, etc), any references to NQF Levels are to the pre-2009 levels unless specifically stated otherwise.  

PURPOSE AND RATIONALE OF THE QUALIFICATION 
Purpose:
The primary purpose of the Master of Commerce (MCom) in Risk Management of Financial Markets is to provide advanced training in four key Risk Management areas - namely, Quantitative Methods, Markets, Governance, and Research. Graduates will be prepared to enter strategic risk management roles in financial services organisations. Financial Risk Management fulfils an integral societal need by facilitating solutions in an ever-changing economic environment while adhering to a special code of conduct.

Upon successful completion of the qualification, learners will:
  • Master the technical aspects of modern Financial Risk Management through high-level theoretical engagement with the subject matter, coupled with the ability to relate intellectual knowledge to the different, interconnected contexts of Organisational Risk Management in practice.
  • Engage in applied research related to effective approaches and practices of Risk Management in the context of financial markets.
  • Master advanced concepts in calculus, linear algebra, probability, statistics and econometrics.
  • Fully comprehend the technical and practical characteristics of the vast array of modern financial instruments and market mechanisms.
  • Be well versed in accounting, regulations, and the key pieces of legislature that govern the global and South African financial services industries.

    One third of the qualification consists of applied research, where learners will complete research components in each of the three core areas. The research activity will afford exemplary graduates the opportunity to further their academic career by enabling enrolment for Doctor of Philosophy (PhD) studies.

    Rationale:
    Financial Risk Management is a relatively new quantitative discipline, the development of which emerged during the 1970s with the introduction of the first Basel Accord between the G10 countries. Since then, the Basel Committee on Banking Supervision has issued the second and third versions of these accords, which are essentially a set of recommendations for regulations in the banking industry. Parallel to these recommendations for the banking industry are the Solvency directives for the insurance industry, set forth by the European Union. During the past 40 years, financial institutions have begun to understand the risks they take, and substantial progress has been made in the field of Financial Risk Management. The quantitative and mathematical nature of Risk Management has manifested in the form of technically rigorous prudential regulations that inform capital adequacy requirements.

    Understanding the multitude of risks that constitute financial risk is the first step toward managing these risks. For a long time the mathematical nature of Financial Risk Management was doubted, primarily due to the much older discipline of asset management. Traditionally, asset managers were restricted to investing in primary securities such as cash, equities and bonds, which are simple and relatively easy to manage financial instruments. Therefore, rigorous mathematical analysis of financial risks was not deemed necessary. The roles of equity, bond or financial analysts associated with asset management were therefore of a qualitative nature, as little or no mathematical analysis was required. The lack of barriers to entry into these markets (e.g. stringent globally-driven regulations and risk-based capital requirements) was also a contributing factor. With risk ultimately being borne by investors, the role of the asset manager is primarily to manage and describe these risks accurately. Historically, failure to do so resulted in legal action, which is a far weaker threat than the global regulatory implications imposed on banks, and therefore hindered the evolution of best practice in Risk Management.

    The escalating sophistication in financial markets, e.g. the growth in the derivatives market, and innovations in retail and wholesale lending and banking, has prompted the development of sophisticated financial market regulation and along with it the practice of Risk Management. Currently, financial firms, be they banking, insurance or asset management, manage these risks on an aggregate and large scale, with capital and derivative markets offering limitless ways to transfer risks between economic agents.

    Risk management in banking has evolved quicker than the insurance and asset management sectors, with the availability of market data and the incentive to reduce regulatory capital serving as the primary catalysts. At present there is a considerable demand for properly qualified financial risk managers. However, there is a lack of academic interventions to satisfy this need. This degree, therefore, represents the first step toward establishing a qualification that professionalises the risk management industry.

    The needs assessment for the development of this qualification conducted by the Financial Services Sector in 2013 involved interviews and surveys with companies including sectors like Banking, Insurance and Asset Management, Regulators and Industry Bodies. The study encompassed a number of areas including: skills deficits, recruitment, the working environment, training and development, and tertiary education.

    The study concluded that 4-year undergraduate Degrees do not adequately prepare learners for the specialist requirements of Risk Management roles in Financial Services. Companies insisted that there exists the requirement for a Master's qualification in Risk Management specifically designed to meet the unique needs of the sector. Further to the initial study and to ensure that the new qualification meets this critical need in the sector, key companies in banking and insurance were consulted for input into the curriculum of this Degree. 
    		•

    LEARNING ASSUMED TO BE IN PLACE AND RECOGNITION OF PRIOR LEARNING 
    The Institution subscribes to the principles underlying outcomes-based, source-based and lifelong learning. In this context, considerations of articulation and mobility play an important role. The Institution endorses the view that recognition of prior learning (RPL) constitutes an essential element of the transformation of access and admissions policies at education institutions in South Africa. The transformation of access and admissions policies is intended to increase participation and to broaden access to higher education in order to produce graduates with the skills and competencies necessary to meet the human resource needs of the country.

    The Institution acknowledges that RPL must be conducted in a valid, reliable and equitable way and that it must take place in accordance with the terms of the University's RPL policy and in accordance with the relevant procedures laid down by the Faculty. Recognition and exemption of modules may be granted in accordance with the provisions contained in the Institution's General Academic Rules.

    Entry Requirements:
    Learners aspiring to access this qualification must have successfully achieved a relevant NQF Level 8 qualification and acquired at least 18 Credits of:
  • Mathematics, at NQF Level 5.
  • Microeconomics, at NQF Level 5.
  • Macroeconomics, at NQF Level 5.
  • Statistics, at NQF Level 5. 
    		•

    RECOGNISE PREVIOUS LEARNING? 
    Y 

    QUALIFICATION RULES 
    This qualification consists of four compulsory modules amounting to 180 Credits.

    Modules:
  • Risk Management Quantitative Modelling, at NQF Level 8, 45 Credits.
  • Risk Management Markets, at NQF Level 9, 45 Credits.
  • Risk Management Governance, at NQF Level 9, 30 Credits.
  • Risk Management Research, at NQF Level 9, 60 Credits. 
    		•

    EXIT LEVEL OUTCOMES 
    1. Display a practical understanding of economics, finance and all commercial aspects of financial services and the strategies employed.
    2. Demonstrate the ability to combine practical financial market knowledge and technical mathematical, statistical and computing knowledge to model, quantify, and measure risk.
    3. Analyse financial market data from various sources, make sound judgements, and propose solutions and/or applications.
    4. Demonstrate a thorough and complete understanding of the accounting, legal, legislative, and regulatory frameworks that govern financial markets.
    5. Demonstrate critical thinking and problem-solving abilities, taking into account the business environment, products, technical aspects, and the external market and governance context.
    6. Display the ability to integrate systems and processes in order to manage risk effectively.
    7.Operate independently and in a group and take full responsibility for own work, and, where appropriate, lead, oversee, and be responsible for the overall governance of processes and systems within a professional or consultative context.
    8. Demonstrate excellent written and verbal communication skills.
    9. Conduct independent research in the Risk Management of Financial Markets field. 

    ASSOCIATED ASSESSMENT CRITERIA 
    Assessment Criteria for Exit Level Outcome 1:
  • A thorough understanding of the financial economic theory, fundamental models and concepts such as utility theory, the capital asset pricing model, and arbitrage pricing theory is demonstrated.

    Assessment Criteria for Exit Level Outcome 2:
  • The history and current state of mathematical and statistical models in finance are understood.
  • An understanding of mathematical models related to the modelling of exposures on all products that bear market and credit risk is displayed.
  • Risk exposures associated with sources of profitability across an organisation are identified.
  • Detailed risk policies and guidelines are developed in order to implement defined risk tolerances.

    Assessment Criteria for Exit Level Outcome 3:
  • Technical and descriptive reports are analysed to produce succinct market commentary, and identify links between potential risks and market fundamentals.
  • Opportunities for new business ventures through the effective execution of risk management functions are identified.

    Assessment Criteria for Exit Level Outcome 4:
  • The impact of ethics, accounting, regulatory and governance frameworks on modern Risk Management is understood.
  • Compliance with all internal and external regulations, policies and procedures is ensured and ethical and professional conduct maintained.
  • Adherence to a strong code of ethics and corporate governance as prescribed by best practice is ensured.
  • Effective working relationships with senior management, external regulators, supporting areas, colleagues, and internal and external clients are maintained.

    Assessment Criteria for Exit Level Outcome 5:
  • A wide range of specialised skills are used in identifying, conceptualising, designing, and implementing methods of enquiry to address complex and challenging problems while understanding the consequences of any solutions or insights generated within the Risk Management of Financial Markets field.

    Assessment Criteria for Exit Level Outcome 6:
  • Models, systems, and all processes related to estimating, measuring and reporting risk exposures, and profitability measures are evaluated and checked.
  • Computational adeptness, particularly a strong understanding of data vendors, Excel, VBA, Matlab, SQL and the interactions between these systems/programmes and internal/external systems is demonstrated.

    Assessment Criteria for Exit Level Outcome 7:
  • Employees at different levels in an organisation are supported to understand, analyse risk, as well as decompose profitability relative to risk exposures.
  • Maintain effective working relationships with senior management, external regulators, supporting areas, colleagues, and internal and external clients.
  • Adherence to risk limits as ratified by the board and senior management is ensured, supported and supervised.

    Assessment Criteria for Exit Level Outcome 8:
  • The ability to translate complex technical concepts into understandable notions for a range of audiences on different levels of knowledge within the Risk Management of Financial Markets domain is exhibited.
  • Detailed risk reports are generated.

    Assessment Criteria for Exit Level Outcome 9:
  • Capacity to undertake high level research is displayed.
  • Technical results are communicated coherently and accurately.
  • Research of creditable quality is produced.

    Integrated Assessment:
    Learners are required to pass all modules of the qualification, all of which are compulsory.
    Risk Management Quantitative Modelling: This module will be assessed through a sequence of computational assignments and mathematical/computational tests. The final examination will have two parts: a practical/computational component, and a theoretical component. The learners will have to demonstrate computational and technical proficiency.

    Risk Management Markets: This module will be assessed through a sequence of modelling assignments and mathematical/computational tests. It will also contain two written risk reports. The learners will have to demonstrate practical understanding of complex risk management challenges. The final examination will have two parts: a practical/computational component, and a theoretical report component.

    Risk Management Governance: This module will be assessed through a sequence of essays, presentations and risk reports. The learners will have to demonstrate an ability to situate governance within firm wide quantitative risk management.

    Risk Management Research: This module will be assessed through three written projects with attendant presentations. The learners will have to demonstrate an integrated understanding of financial risk management. 
    		•

    INTERNATIONAL COMPARABILITY 
    Thailand:
    The Graduate School of Business Administration (GSBA) at the National Institute of Development Administration (NIDA) presents an MSc in Financial Investment and Risk Management Degree. The duration of the MSc Degree is at least eighteen month. This qualification has a strong focus on Financial Analysis and Risk Management of institutions and prepares learners for the Chartered Financial Analyst (CFA) and Financial Risk Manager (FRM) examinations. Growth in world financial markets has created an unprecedented demand for investment practitioners, hence establishing the importance of a globally accepted standard with which employers and investors can validate the knowledge integrity, and professionalism of investment managers and financial analysts. That standard is the Chartered Financial Analyst (CFA) Program. The Chartered Financial Analyst designation was first instituted in 1963 and has become the de-facto standard for financial professionals who work in the global investment community.

    Modules include:
  • Quantitative Analysis for Business Decisions: provide learners with an understanding of the fundamentals of statistical probabilities and distributions, random sampling, one-sample hypothesis testing and confidence intervals, simple and multiple linear regression, correlation analysis, analysis of variance and chi-square applications.
  • Quantitative Analysis for Business Decisions: explores concepts and the uses of statistical and mathematical models for economic and business problems.
  • Microeconomics and Macroeconomics: covers the calculation of gross domestic product, consumption, investment, unemployment and price levels. Furthermore, it covers theory of consumer choice and demand, estimation and forecasting demand, theory of production and cost, market structure, game theory, pricing theory, theory of demand and supply of factor market, general equilibrium and making decision under risk and uncertainty.
  • Financial Accounting: involves the preparation and interpretation of financial statements; the use of financial information to evaluate and control an organisation.
  • Financial Reporting and Corporate Governance: addresses issues pertaining to Corporate Governance and Financial accounting, reporting and analysis of financial statements with the focuses on pensions, stock compensation, and other employee benefits, inter-corporate investments, business combinations and multinational operations.
  • Financial Modelling: covers standard financial models in the areas of corporate finance models, portfolio management models, options pricing models, fixed income management models.
  • Financial Risk Management: offers an understanding of the mathematical models used for risk management and financial derivatives, the arbitrage-free principle, single-period and multi-period valuation models, valuations of exchange-traded options, application to valuation of uncertain cash flow streams, complete and incomplete models and applications to sophisticated management of risk and insurance products.
  • Thesis: provides learners the opportunity to carry out an in-depth research project taking into account the administrative research protocols, publish the results of a research thesis and defend it in an oral examination.

    United Kingdom:
    The MSc International Risk Management and Finance Degree offered by Bournemouth University constitutes a multi-dimensional study of risk with aspects of finance, governance and ethics and addresses more traditional practices of risk management. Risk management is now a key driver in business and there is a rapidly increasing requirement for postgraduates to provide core risk management assistance. This qualification will give learner the opportunity to develop the requisite technical competencies, and acquire and apply sound decision-making skills to complex practical situations.

    The qualification consists of the following compulsory modules:
  • International Accounting and Analysis: explores the principles for producing financial statements, outline the theoretical and regulatory framework financial accounting operates in and offer techniques for analysing corporate financial reporting.
  • Economics of Money and Financial Markets: provides a solid grounding in the economic concepts surrounding the monetary system and financial markets.
  • International Corporate Finance: addresses the importance of the corporate finance function in an internationally diverse corporation and to offer a framework for assisting corporate decision-makers in a complex, dynamic and inherently uncertain external environment.
  • International Investment Management: offers an understanding of the workings, structure and importance of the global investment marketplace and its role in risk analysis and management at practical and theoretical levels.
  • Enterprise Risk Management: provides an understanding of the theoretical and practical aspects of risk.
  • Corporate Governance and Ethics: explores the objectives, principles and methods of corporate governance practice in different economic environments and offers an understanding of governance and ethics can aid managerial decision-making, particularly for risk management.
  • Research Project: presents learners with an opportunity to undertake a significant piece of self-managed research in an area that interests them.

    Conclusion:
    The Master of Commerce in Risk Management of Financial Markets compares well with the above international qualifications in terms of the research component and the similarity in modules generally. 
    		•

    ARTICULATION OPTIONS 
    Horizontal articulation is possible with:
  • Master of Commerce in Banking and Financial Risk Management, at NQF Level 9.
  • Master of Business Administration in Strategic Financial Management, at NQF Level 9.

    Vertical articulation is possible with:
  • Doctor of Philosophy in Economics.
  • Doctor of Philosophy in Business Management. 
    		•

    MODERATION OPTIONS 
    N/A 

    CRITERIA FOR THE REGISTRATION OF ASSESSORS 
    N/A 

    NOTES 
    N/A 

    LEARNING PROGRAMMES RECORDED AGAINST THIS QUALIFICATION: 
     
    NONE 


    PROVIDERS CURRENTLY ACCREDITED TO OFFER THIS QUALIFICATION: 
    This information shows the current accreditations (i.e. those not past their accreditation end dates), and is the most complete record available to SAQA as of today. Some Primary or Delegated Quality Assurance Functionaries have a lag in their recording systems for provider accreditation, in turn leading to a lag in notifying SAQA of all the providers that they have accredited to offer qualifications and unit standards, as well as any extensions to accreditation end dates. The relevant Primary or Delegated Quality Assurance Functionary should be notified if a record appears to be missing from here.
     
    1. University of Cape Town 


    All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.