Students learn to value the main types of derivative securities and how to effectively utilize them in risk management, asset speculation and financial engineering. Topics include an introduction to forward and futures markets and hedging; mechanics of future markets; hedging with future contracts; theoretical and forward prices; introduction to options; calculating option contract profits; put-call parity and arbitrage bounds; option pricing models; exotic options; and swaps. Prerequisite: FNCE 2120 (minimum C+ grade) or equivalent and ECON 2330 (minimum C- grade) or equivalent Note: Students cannot receive credit for more than one of FNCE 4170 or FNCE 3180
Students learn to value the main types of derivative securities and how to effectively utilize them in risk management, asset speculation and financial engineering. Topics include an introduction to forward and futures markets and hedging; mechanics of future markets; hedging with future contracts; theoretical and forward prices; introduction to options; calculating option contract profits; put-call parity and arbitrage bounds; option pricing models; exotic options; and swaps. Prerequisite: FNCE 2120 (minimum C+ grade) or equivalent and ECON 2330 (minimum C- grade) or equivalent Note: Students cannot receive credit for more than one of FNCE 4170 or FNCE 3180
