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Derivative Securities unit (BEA380)

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Unit year 2027

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Introduction

In this face-to-face and flexible delivery unit, we develop an understanding of one of the fastest growing types of financial markets - those of derivative securities. They are called derivative securities because they ‘derive’ their value from the value of something else—an underlying right or interest. Underlying rights or interests (or assets in general) include (a) bonds or loans, which involve interest rate, credit, and currency risks, and (b) commodities and equities, which involve price risks. Underlying rights can also be groups of assets, such as equity or commodity indexes, or relationships between prices, such as the spread between two benchmarks. Derivatives securities play an important role in risk management.

Summary

Unit name Derivative Securities
Unit code BEA380
Credit points 12.5
College/School Tasmanian School of Business and Economics
Discipline Finance
Coordinator Doctor Richard Mawulawoe Ahadzie
Available as an elective? Yes
Delivered By University of Tasmania
Level Advanced

Sustainable Development Goals

The Unit Coordinator has identified that this unit aligns with the following UN Sustainable Development Goals. We welcome your thoughts and feedback on the alignment of the unit with these goals.

Availability

Specific information on 2027 unit availability will be available in August

Learning Outcomes

  • Describe the concept of options, forwards, futures and swaps and their markets.
  • Critically analyse the mechanics of options, forwards, futures and swaps, and their applications in real-world scenarios.
  • Compute prices of options, forwards, futures, and swaps, and evaluate their implementation incorporating various factors such as risk management, market liquidity, and contract specifications.

Fee Information

2027 fee information will be available in August.

Teaching

Teaching Pattern

Tuition Pattern Details

Activity Type Duration Frequency
Lectures 2 hours Weekly
Face-to-Face Workshops (On-campus students) 2 hours 6 times (Semester)
Online Workshops (Distance Students) 2 hour 6 times (Semester)

 

AssessmentAssignment (20%)|Online Test 1 (20%)|Online test 2 (20%)|Final Exam (40%)
TimetableView the lecture timetable | View the full unit timetable

Textbooks

Required

You will need the following text [available from the Co-op Bookshop]:

An Introduction to Derivative Securities, Financial Markets, and Risk Management (2nd Edition) by (author): Robert Jarrow (Cornell University, USA) and Arkadev Chatterjea (Indiana University, USA). Pages: 772 | July 2019. ISBN: 9781944659653 (paperback).
Recommended

: Baz, J. & Chacko, G.K. (2009), Financial Derivatives: Pricing, Applications, and Mathematics (Paperback), Cambridge University Press.

Cox, J. & Rubinstein, M. (1985), Options Markets, Prentice-Hall, New Jersey.

Dubofsky, D.A. (1992), Options and Financial Futures: Valuation and Uses, McGraw-Hill, New York.

Hull, J.C. et all (2013). Fundamentals of Futures and Options Markets: Australasian edition, Pearson Australia.

Kolb, R.W. (1997), Futures, Options and Swaps, Blackwell Business Publishers, 2nd edn, Malden.

McDonald, R. L. (2009), Fundamentals of Derivatives Markets. Prentice Hall, Boston.

Strong, R.A. & Jeyasreedharan, N. (2017). Understanding Derivatives: Options, Futures, Swaps, MBSs, CDOs and Others (First Edition), Tilde Publishing and Distribution, Prahan.

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