Futures and Options


This course is designed for students who are not necessarily from the area of Finance or have not yet completed or followed the course of Investments. Its content is intended to be an introduction to derivatives, focusing on their economic content, strategic use and little mathematics. We introduce the basics derivatives instruments namely futures, forwards, swaps and options. The last four classes (on options) repeat material taught in the course of Investments. The course is also about financial markets in the sense that explores the uses of such instruments, their pricing principles and trading mechanisms.

General characterization





Responsible teacher

João Amaro de Matos


Weekly - Available soon

Total - Available soon

Teaching language





  • John Hull, Options Futures and Other Derivatives, Pearson, New York, 2014.
  • Jarrow and Chatterjea, Derivative Securities, Financial Markets and Risk Management, Norton, New York, 2013.
  • Teaching method

    - Lectures in class (twice a week)

    - Weekly quizzes on Moodle in order to revise regularly the material

    - Students must follow the Khan Academy topics in order to prepare for classes

    - Case studies will be prepared and presented in groups

    - Final exam

    Evaluation method

    •    Case studies   30%
    •    Quizzes    20%
    •    Final Exam    50%

    Subject matter

    1: Introduction to Futures and Forwards: Mechanics of Future Markets

    2: Pricing and hedging with Futures and Forwards

    3: Practitioner Presentation: Futures and Forwards

    4: Swaps  

    5: Credit Default Swaps

    6: Practitioner Presentation: Swaps

    7: Case Study Presentation: Swaps

    8: Options contracts, markets, and strategies

    9: Option pricing: non-arbitrage principle  

    10: Option pricing: the binomial model

    11: Practitioner Presentation: Options  

    12: Case Study Presentation: Options