FIN42020 Derivative Securities

Academic Year 2023/2024

This course provides an introduction to derivative securities. Alternative derivative securities are outlined. This incorporates detailing the properties of these securities. Furthermore, a key aim is to outline how these assets are valued. Also the course demonstrates the use of derivatives in arbitrage, hedging and speculation. Risk, different types of risk, different risk measures, and associated methods of obtaining and validating the risk measures are outlined. Finally, practical applications of derivatives and potential pitfalls are discussed. Throughout the course we will document theoretical and empirical findings from the literature to develop the research skills and knowledge of students.

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Curricular information is subject to change

What will I learn?

Learning Outcomes:

On completion of this module students should be able to:
Describe the different types of derivatives, their uses and the operations of their respective markets.
Explain the use of derivatives in risk management, speculation and arbitrage
Detail the use of hedging and evaluation of hedging.
Describe risk measurement, the alternative measures and methods of obtaining measures.
Describe alternate pricing mechanisms for derivatives
Develop research skills including data analysis and reviewing of salient literature.

How will I learn?

Student Effort Type	Hours
Lectures	24
Tutorial	8
Total	32

Am I eligible to take this module?

Requirements, Exclusions and Recommendations

Not applicable to this module.

Module Requisites and Incompatibles

Not applicable to this module.

How will I be assessed?

Assessment Strategy

Description	Timing	Open Book Exam	Component Scale	Must Pass Component	% of Final Grade
Examination: The final exam will be an online exam consisting of 50% MCQ and 50% written answer questions, covering material drawn from the course and the provided problem sets.	2 hour End of Trimester Exam	No	Alternative linear conversion grade scale 40%	No	50
Assignment: The assignment will test your understanding of the learning outcomes of the course using Option Metrics data from a unique date to trade or hedge on.	Coursework (End of Trimester)	n/a	Alternative linear conversion grade scale 40%	No	50

Carry forward of passed components
Yes

What happens if I fail?

Resit In	Terminal Exam
Spring	Yes - 2 Hour

Assessment feedback

Feedback Strategy/Strategies

• Feedback individually to students, post-assessment
• Online automated feedback

How will my Feedback be Delivered?

Not yet recorded.

When is this module offered?


Autumn
Lecture	Offering 1	Week(s) - 7, 8, 9, 10, 12	Thurs 09:00 - 10:50
Lecture	Offering 1	Week(s) - 11	Thurs 10:00 - 11:50
Lecture	Offering 1	Week(s) - 8, 9, 10, 11, 12	Tues 11:30 - 13:20
Lecture	Offering 2	Week(s) - 11	Thurs 10:00 - 11:50
Lecture	Offering 2	Week(s) - 7, 8, 9, 10, 12	Thurs 11:30 - 13:20
Lecture	Offering 2	Week(s) - 8, 9, 10, 11, 12	Tues 09:00 - 10:50
Tutorial	Offering 1	Week(s) - 8, 9, 10, 11	Fri 10:00 - 10:50
Tutorial	Offering 1	Week(s) - 8, 9, 10, 11, 12	Tues 14:30 - 15:20
Tutorial	Offering 2	Week(s) - 8, 9, 10, 11	Fri 11:00 - 11:50
Tutorial	Offering 2	Week(s) - 8, 9, 10, 11, 12	Tues 13:30 - 14:20
Tutorial	Offering 3	Week(s) - 8, 9, 10, 11	Fri 13:30 - 14:20
Tutorial	Offering 3	Week(s) - 8, 9, 10, 11, 12	Tues 16:00 - 16:50
Tutorial	Offering 4	Week(s) - 8, 9, 10, 11	Fri 12:30 - 13:20
Tutorial	Offering 4	Week(s) - 8, 9, 10, 11, 12	Tues 17:00 - 17:50
Autumn