Course

Derivatives and Specialized Products

Faculty
Commerce & Business Administration
Department
Finance
Course Code
FINC 4450
Credits
3.00
Semester Length
15 Weeks X 4 Hours per Week = 60 Hours
Max Class Size
35
Method(s) Of Instruction
Lecture
Seminar
Typically Offered
To be determined

Overview

Course Description
Derivatives and specialized products is a course which will examine topics dealing with derivative securities. Derivative securities are often utilized in the management of interest rate, exchange rate, commodity and equity price risks. Derivative securities also provide a vehicle for investors to speculate. The types of derivative securities, their use in modern finance, and methods for pricing them will be the subject matter for this course.
Course Content
  1. Discussion of risk
  2. Mechanics and pricing of forwards and futures
  3. Interest rate futures
  4. Swaps
  5. Options markets
  6. Properties of stock options
  7. Trading strategies involving options
  8. Option pricing: the binomial model
  9. Option pricing: the Black-Scholes model
  10. Options on stock indices, currencies, and futures
Learning Activities

Material will be presented within a lecture format.

Means of Assessment

Minimum of 3 evaluations, none of which will exceed 40%, for a total of 100%.

Students may conduct research as part of their coursework in this class. Instructors for the course are responsible for ensuring that student research projects comply with College policies on ethical conduct for research involving humans, which can require obtaining Informed Consent from participants and getting the approval of the Douglas College Research Ethics Board prior to conducting the research.

Learning Outcomes

At the end of the course, the successful student should be able to:

 

  1. analyze and understand the meaning of risk;
  2. utilize derivative securities for the purpose of managing risk;
  3. determine the value of different derivative securities;
  4. analyze the mechanics of futures and options trading.
Textbook Materials

Textbooks and Materials to be Purchased by Students

 

  • Hull, J.  Fundamentals of Futures and Options Markets, Latest Ed. Toronto: Prentice Hall Canada.  (required)

 

  • Ritchken, P.   Derivative Markets: Theory, Strategy, and Applications, Latest Ed.  HarperCollins Publishers Ltd.  (optional)

Requisites

Prerequisites

FINC 3390

Corequisites

FINC 4440

Equivalencies

Courses listed here are equivalent to this course and cannot be taken for further credit:

  • No equivalency courses

Course Guidelines

Course Guidelines for previous years are viewable by selecting the version desired. If you took this course and do not see a listing for the starting semester / year of the course, consider the previous version as the applicable version.

(Current)

Course Transfers

These are for current course guidelines only. For a full list of archived courses please see https://www.bctransferguide.ca

Institution Transfer Details for FINC 4450
Langara College (LANG) LANG BUSM 2XXX (3)

Course Offerings

Summer 2024