The aim of this course is to show students the mechanism of financial derivative markets, futures prices, hedging and trading strategies using derivative products and option pricing.

1. Students will define the option price and its determinants. 2. Students will identify the difference between spot and futures markets and set futures prices. 3. Students will define the mechanism of forward, futures, swaps and options. 4. Students will design a hedging strategy using futues and forward. 5. Students will choose to buy and sell strategies by choosing different options. 6. Students will design swap contracts in the presence and absence of financial intermediaries.