On completion of the course, the learner should be able to
UNIT I Introduction to derivatives
Introduction to derivatives – types – necessity for derivatives – valuation basics – discounting and compounding – Time value – continuous compounding – significance
UNIT II Forward and Futures
Forward contract and Futures Contract – Forwards – futures – Pricing of Futures and Forwards – options pricing strategy – commodity derivatives – currency futures and Interest Rate futures – Index futures – pricing
UNIT III Options
Types of Options – Differentiate European & American options – Call option and put Option – option pricing models – Binomial Model – Black and Scholes – Volatility
UNIT IV Swaps
Swaps – Equity – Currency – Interest Rate– Types – Structure – Pricing – Financial Derivatives in Indian Financial Markets
UNIT V Other Derivatives
Risk Management Using Derivatives – Exotic Derivatives – Weather Derivatives – Credit Derivatives – Real Derivatives – Scenario Analysis and Simulation – developments and trends in the area of derivatives trading.
Learning Resources
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