Overview
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Academic contacts
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Requisites
Prerequisite
Exclusion
Other learning activities
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Learning activities
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Learning outcomes
1.
Discuss the manner in which financial instruments are traded on financial markets;
2.
Explain the concept of arbitrage, and its implications for market efficiency;
3.
Apply arbitrage concepts to the valuation of financial instruments;
4.
Critically evaluate the features and uses of the major derivative instruments;
5.
Describe the role of hedged positions and how they can be set up and maintained; and
6.
Communicate clear and coherent expositions of knowledge, ideas and evidence, both orally and in writing.
Assessments
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Additional information
Unit content:Calculations of the price sensitivity of interest rate instruments;
The role of futures and options in achieving speculative goals with respect to commodities, financial futures, stocks and indices;
Hedging a position in commodities using futures;
Establishing a hedge for a position in interest rate instruments using futures, forward rate agreements, options and swaps and other derivative instruments;
Establishing arbitrage positions using combinations of financial instruments and derivatives