Futures and Options
Objectives
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
Code
2257
Credits
3.5
Responsible teacher
João Amaro de Matos
Hours
Weekly - Available soon
Total - Available soon
Teaching language
English
Prerequisites
n/a
Bibliography
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
Programs
Programs where the course is taught: