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Unit of Study

Derivative Securities
UoS Code FINC3012
Credit points 6
Offered Semester 2
Prerequisites FINC2012 or FINC2002
Prohibitions FINC3002
Assumed Knowledge
Additional Information Knowledge of calculus, regression, probability theory and random distributions are helpful for this subject
Lectures 1x 2hr lecture and 1x 1hr tutorial per week
Assessment group assignment (20%), mid-semester test (30%), final exam (50%)
Description Options, futures and swaps are derivatives of underlying securities such as commodities, equities and bonds. These types of securities are increasingly used to manage risk exposure and as a relatively low-cost-way of taking a position in a security or portfolio. They are also being used as part of senior management compensation as a way of attempting to align the interests of shareholders with that of management. This unit is designed to provide an introduction to this important area of finance without requiring too high a level of mathematical sophistication. However, strong quantitative skills are an advantage in this subject.