Choosing the Right Short-Term Financing Tools

This video covers the following learning objectives:

General/All Certifications

✅ Explain why short-term financing is essential for maintaining liquidity and operational continuity
✅ Identify common short-term financing tools for businesses of various sizes
✅ Compare short-term financing options based on cost, flexibility, and risk
✅ Utilize Excel to analyze short-term financing scenarios

Canadian Securities Course (CSC)

✅ Recognize money market instruments used for short-term corporate financing (e.g., Commercial Paper)
✅ Understand trade credit and other short-term financing mechanisms relevant to company operations
✅ Evaluate basic corporate liquidity management strategies

Certified Financial Planner (CFP) – Canada

✅ Select appropriate short-term financing tools for small businesses and individuals
✅ Compare the advantages and disadvantages of lines of credit, trade credit, credit cards, and short-term loans
✅ Explain how short-term financing decisions support cash flow and liquidity management for clients

Financial Risk Manager (FRM)

✅ Assess liquidity risk arising from short-term financing dependence
✅ Evaluate advanced short-term financing instruments such as repurchase agreements and commercial paper
✅ Understand rollover risk, counterparty risk, and funding liquidity risk
✅ Apply risk mitigation strategies for short-term funding gaps

Chartered Financial Analyst (CFA) – Level 1 & 2

✅ Compare various short-term financing tools, including their costs, risks, and strategic use
✅ Explain trade-offs between short-term and long-term financing options
✅ Analyze how short-term financing decisions impact liquidity, profitability, and overall capital structure
✅ Demonstrate calculation of proceeds and effective cost of instruments like commercial paper using Excel