Handbook

In today’s fast-paced financial markets, derivatives such as options and futures are integral to risk management, portfolio optimization, and price discovery. This course provides hands-on experience with the tools and techniques used to manage asset risk, focusing on the strategic use of derivatives in various market conditions. You will explore fundamental concepts like forward and futures contracts, options on stocks, indices, and futures, and how they can be used to hedge positions and manage uncertainty in financial markets.

Throughout the course, you will gain an intermediate understanding of key pricing models, such as binomial option pricing and risk-neutral valuation, and learn how stochastic processes drive stock price movements. By working with real-world cases, you will become familiar with the numerical methods used for option pricing, including techniques for valuing options on non-traded assets. The course also delves into more complex topics such as exotic options and the biases that can affect pricing models in practice.