TTA-45036 Introduction to Financial Engineering and Derivatives Markets, 3 cr
Person responsible
Juho Kanniainen
Lessons
| Implementation | Period | Person responsible | Requirements |
| TTA-45036 2018-01 | 3 |
Margarita Baltakiene Juho Kanniainen |
Exam |
Learning Outcomes
Understanding of the derivatives markets and the principles of pricing and hedging of options and other derivatives is essential for people working for a) corporations on the use of derivatives for risk management and b) banks and other financial institutions for trading and risk management. After studying this course, the student - Understands the function and characteristics of derivative markets - Understands the specifications of the most common financial derivatives - Understands the no-arbitrage principle in option pricing - Can apply discrete-time models to price vanilla options
Content
| Content | Core content | Complementary knowledge | Specialist knowledge |
| 1. | Options and other derivatives: - Derivatives markets - Derivatives contracts | ||
| 2. | Understanding the no-arbibtrage principle in option pricing under Binomial option pricing model. | ||
| 3. | Practicalities: - Volatility surface; - Greeks; |
Instructions for students on how to achieve the learning outcomes
Exam 100%
Assessment scale:
Numerical evaluation scale (0-5)
Partial passing:
Study material
| Type | Name | Author | ISBN | URL | Additional information | Examination material |
| Book | Options, Futures, and Other Derivatives | John Hull | ISBN: 978-0-13-345631-8 | No |
Prerequisites
| Course | Mandatory/Advisable | Description |
| MAT-02500 Todennäköisyyslaskenta | Advisable | |
| MAT-02550 Tilastomatematiikka | Advisable | |
| MAT-63506 Scientific Computing | Advisable | |
| TTA-45010 Yritysrahoitus ja rahoitusmarkkinat | Advisable |
Additional information about prerequisites
Courses on probability, statistics, and computing (Matlab) and some prerequisites on finance highly recommended.
Correspondence of content
There is no equivalence with any other courses