Registry
Module Specifications
Archived Version 2020 - 2021
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Description This module aims to develop students understanding of some of the main uses and applications of financial instruments and strategies in the process of managing the main needs of borrowers, investors and financial intermediaries in financial markets. | |||||||||||||||||||||||||||||||||||||
Learning Outcomes 1. Identify the main types of financial risks faced by corporations and financial institutions. 2. Assess some of the main strategies that may be used to manage the various types of financial risks. 3. Value some simple financial instruments and explain the process of how more complex financial products may be valued. 4. Critique recently developed metrics and concepts in the areas of financial engineering and risk management 5. Identify the potential risks and limitations associated with valuation models being used | |||||||||||||||||||||||||||||||||||||
All module information is indicative and subject to change. For further information,students are advised to refer to the University's Marks and Standards and Programme Specific Regulations at: http://www.dcu.ie/registry/examinations/index.shtml |
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Indicative Content and
Learning Activities No-arbitrage pricingReplication of financial and non-financial payoffs, No-Arbitrage and Risk Neutral ValuationForwards and futuresForward rate agreements (FRAs); synthetic agreements for forward exchange (SAFEs); currency forwards and futures; short-term interest rate futures; T-Bill futures; market timing and duration; stock index futures; stock market timing with futuresSwapsCurrency and interest rate swaps; managing interest rate risk and currency risk with swapsOptionsHedging and volatility: delta hedging; option spreads and stock options: synthetic securities, bull and bear spreads, straddle, strangle, butterfly and condor, stock options; interest rate options (including caps, floors, collars, swaptions); foreign currency options; future options; portfolio insuranceManaging riskMarket and credit risk in financial and non financial firms; defining and measuring market and credit risk exposures; risk reduction vs. yield enhancement techniques; buying and selling convexity; structured finance and securitization | |||||||||||||||||||||||||||||||||||||
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Indicative Reading List
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Other Resources None | |||||||||||||||||||||||||||||||||||||
Programme or List of Programmes | |||||||||||||||||||||||||||||||||||||
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