DERIVATIVE SECURITIES

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Overview

In recent years there has been a dramatic increase in the size and complexity of the types of investment securities, the markets in which they are traded, and the institutions which trade them. In order to reduce the risks associated with trading these investment securities, derivative securities, such as forwards, futures, swaps and options, have rapidly evolved. Unfortunately, in some cases these derivative securities have increased rather than reduced the financial risks faced by individuals, corporations and even governments. This subject provides you with a roadmap which will help you to understand derivative securities and derivative markets. Through this subject you will develop the skills of a financial risk manager to price derivative securities and to use them to define risk management strategies which meet the risk-reward objectives of different investors.

Portfolio

Office of the Provost

School

Subject coordinator

Doureige Jurdi

Subject type

Undergraduate

Year level

Year Level 2 - UG

AQF level

Level 6 - Advanced Diploma

Available as elective

Available to study abroad / exchange students

Yes

Capstone subject
Capstones provide students with a way of integrating and applying knowledge and skills gained throughout their course.

Academic progress review - Schedule A subject

Subject instances

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Learning resources

Prescribed - Book - Options, Futures and other Derivatives.

Career ready

Work based learning (placement):No

Graduate capabilities

DISCIPLINE KNOWLEDGE AND SKILLS

INQUIRY AND ANALYSIS - Creativity and Innovation

INQUIRY AND ANALYSIS - Critical Thinking and Problem Solving

INQUIRY AND ANALYSIS - Research and Evidence-Based Inquiry

PERSONAL AND PROFESSIONAL - Adaptability and Self-Management

PERSONAL AND PROFESSIONAL - Ethical and Social Responsibility

Subject intended learning outcomes

On successful completion you will be able to:

Compare and contrast financial derivatives, their markets in different countries, and the risk and return characteristics of different types of financial derivatives.

Explain relevant financial theories and apply them to the pricing and valuation of financial derivatives.

Measure the exposure to market risk of investment securities and portfolios.

Demonstrate the hedging strategies employed by financial risk managers, to manage the exposure to market risk exposure of investment securities and portfolios, using appropriate digital tools and information services

Analyse and resolve ethical dilemmas associated with financial trading and the provision of investment advice

Define an industry engagement and job search plan, by exploring the range of opportunities to engage with alumni, finance professionals, employers of finance majors, and professional associations

Handbook