Financial Derivatives by Dr Pramod Gupta MBA 4th sem

Financial Derivatives by Dr Pramod Gupta MBA 4th sem

Syllabus

M-410: Financial Derivatives

 

Unit	Course Description	Sessions
Unit I	Financial Derivatives: Definition, Types and Classification of Financial Derivatives, Difference Between Forwards and Futures and Futures and Options, Participants in the Derivative Markets.	3
Unit II	Forward Market: Forward Contracts, Concept and Features, Classification of Forward Contracts, Forward Trading Mechanism.	2
Unit III	Futures Markets: Futures Market Trading Mechanism Specifications of a Futures Contract, The Operation of Margins, Clearing House, Lot Size, Tick Size, Open Interest, Closing out a Futures Position.	3
Unit IV	Pricing of Derivatives: Pricing of Forwards/Futures, Index Futures, Currency Futures, Commodity Futures Using Cost of Carry Model, Relationship Between Spot Price and Futures Price, Contango and Normal Backwardation Market.	2
Unit V	The Indian Scenario of Derivatives Markets: Introduction, Evolution of Derivatives in India. Regulation: Structure of the Derivatives Market, Derivatives Regulation in Indian Stock Market, L.C Gupta Committee Recommendations.	3
Unit VI	Interest Rate Futures: Introduction, Short Term Interest Rate Futures, Pricing A T-Bill future. Long Term Futures Contracts: Application of Interest Rate Futures, Long Hedge, Short Hedge.	4
Unit VII	Swaps: Introduction, Features and Mechanics of Swaps, Major Types of Financial Swaps, Valuation of Interest Rate Swaps and Currency Swaps.	3
Unit VIII	Options: Introduction, Options Terminology, Types of Options, Payoffs from Options Positions, Option Valuation: Intrinsic and Time Value of an Option. Pricing of Options: Determinants of Option Prices, The Black-Scholes Option Pricing Model, One Step Binomial Option Pricing Model.	4