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Unit Summary
Unit type
UG Coursework Unit
Credit points
12
AQF level
Level of learning
Advanced
Former School/College
Pre-requisites
Unit aim
Introduces students to financial risk management including foreign exchange and interest rates, derivative securities and markets, derivative pricing, and financial risk mitigation strategies. Students will engage in teacher-directed activities and experiences relevant to contemporary financial risk management in the multinational enterprise context.
Unit content
Topic 1: Financial Derivatives: An Introduction
Topic 2: Mechanics of Forwards and Futures
Topic 3: Pricing Forwards and Futures
Topic 4: Strategies using Forwards and Futures
Topic 5: Mechanics of Options
Topic 6: Binomial Option Pricing Model
Topic 7: Black-Scholes-Merton Option Pricing Model
Topic 8: Strategies using Options I
Topic 9: Strategies using Options II
Topic 10: Financial Risk Management: Techniques and Applications
Topic 11: Managing Financial Risk in an Organisation I
Topic 12: Managing Financial Risk in an Organisation II
Learning outcomes
Unit Learning Outcomes express learning achievement in terms of what a student should know, understand and be able to do on completion of a unit. These outcomes are aligned with the graduate attributes. The unit learning outcomes and graduate attributes are also the basis of evaluating prior learning.
| On completion of this unit, students should be able to: | GA1 | GA2 | GA3 | GA4 | GA5 | GA6 | GA7 | |
|---|---|---|---|---|---|---|---|---|
| 1 | Evaluate risks associated with financial asset ownership | |||||||
| 2 | Explain the characteristics of financial derivative securities and markets | |||||||
| 3 | Price financial derivatives using appropriate models | |||||||
| 4 | Implement risk management and trading strategies using financial derivatives | |||||||
| 5 | Discuss the techniques available to reduce financial risk associated with trading and operating commercially in an international environment | |||||||
| 6 | Explain the value of financial risk management in the current economic environment. | |||||||
On completion of this unit, students should be able to:
-
Evaluate risks associated with financial asset ownership
- GA1:
- GA4:
-
Explain the characteristics of financial derivative securities and markets
- GA4:
- GA7:
-
Price financial derivatives using appropriate models
- GA1:
-
Implement risk management and trading strategies using financial derivatives
- GA1:
-
Discuss the techniques available to reduce financial risk associated with trading and operating commercially in an international environment
- GA4:
- GA7:
-
Explain the value of financial risk management in the current economic environment.
- GA1:
- GA4:
- GA7:
Prescribed texts
- Chance, DM & Brooks, R, 2016, An Introduction to Derivatives and Risk Management, 10th edn, Cengage Learning, Boston, MA, USA. ISBN: ISBN-13: 978-1-305-10496-9.
- Chance, DM & Brooks, R, 2016, An Introduction to Derivatives and Risk Management, 10th edn, Cengage Learning, Boston, MA, USA. ISBN: ISBN-13: 978-1-305-10496-9.