Derivatives Securities
Demystify the world of derivatives — options, futures, swaps, and structured products. From pricing theory to real-world hedging strategies, taught by specialists.
Course Overview
What is Derivatives Securities?
Derivatives are among the most powerful — and most misunderstood — instruments in finance. This course covers the full spectrum of derivative securities: their structure, pricing, and practical applications for hedging, speculation, and portfolio management. The course focuses on economic intuition and business logic rather than heavy mathematics, making it accessible without sacrificing rigour.
Learning Objectives
What You Will Learn
✦
Instrument typesUnderstand options, futures, forwards, swaps, and structured products — their mechanics and key differences.
✦
Financial engineeringAnalyse P&L profiles of derivatives and learn how they are used to transform risk in portfolios.
✦
Pricing modelsApply Black-Scholes, binomial trees, and Monte Carlo simulation to value options and exotic derivatives.
✦
The GreeksUnderstand Delta, Gamma, Theta, Vega, and Rho — and how they are used to manage derivatives risk.
✦
Hedging strategiesBuild dynamic hedging strategies to manage interest rate, equity, currency, and credit risk.
✦
No-arbitrage pricingApply the no-arbitrage principle and risk-neutral pricing framework to derivative valuation.
Who Is This For?
Prerequisites & Who Should Enrol
- CFA candidates — Derivatives is a tested topic across all three CFA levels.
- Finance professionals who work with or need to understand derivatives positions.
- Risk managers, portfolio managers, and treasury professionals.
- Students interested in quantitative finance or structured products.
- No advanced mathematics required — calculus is not needed for this course.
Got Questions?
Frequently Asked Questions
Do I need advanced maths to study derivatives?
No. This course is designed for students with standard finance backgrounds. While some quantitative tools are used (binomial trees, Black-Scholes), the focus is on economic intuition and business logic — not advanced calculus or stochastic calculus.
What is no-arbitrage pricing and why does it matter?
No-arbitrage pricing is the fundamental principle that there should be no way to earn a risk-free profit with zero investment. It is the foundation for valuing all derivatives — it gives us the Black-Scholes formula, put-call parity, and binomial option pricing.
How important are derivatives for the CFA exam?
Derivatives is a required topic across all three CFA levels. At Level 1 it covers fundamentals; at Level 2 it covers valuation in depth; at Level 3 it is applied to portfolio risk management. Our tutors will align your prep precisely to your level.