An Introduction to the Derivatives Markets

Course Overview

Barings, Société Générale, AIG, JP Morgan — venerable financial institutions damaged, some to the point of bankruptcy, by unauthorised derivatives trading activity. This programme introduces derivatives to finance newcomers and those encountering such products for the first time, exploring practical applications of these financial tools.

Programme 1

• The origins of derivatives — what are they exactly, who uses them and why?
• Exchange traded vs over-the-counter instruments — a changing world; central counterparties
• Vanilla vs exotic derivatives; cash vs physical settlement
• Inherent risks with derivatives — what could possibly go wrong?

Programme 2

• Options defined and terminology
• The asymmetry of risk; intrinsic vs time value
• In, at and out of the money options
• Credit Default Swaps — a tool for bond fund managers
• Futures — referencing the underlying markets (from equities to commodities)
• Initial and variation margin; leverage; function of the clearing house

Learning Outcomes

Participants will understand links between underlying cash markets and derivative markets, appreciating how these instruments function in today's electronic markets and their relevance to financial news.

Course Details

Duration: 2 hours. Format: online, in-person or hybrid. Price from £210.00 (plus VAT) per delegate for up to twelve participants.