Paul Spindt：【18级MFIN】Options and Other Derivatives
A derivative is a fifinancial contract whose value is not intrinsic, but instead is derived from the value of some underlying asset called a reference asset. Derivatives are side-bets that do not involve direct claims on the underlying assets. Derivatives are useful for trading the risk associated with reference assets without having to buy or sell the underlying assets themselves. The market for derivatives is huge and global. The Bank for International Settlements estimates that nearly 1,000 trillion US dollars (notional principal) of over-the-counter derivatives were outstanding in June 2016. Add to that another about 200 trillion US dollars in exchange traded derivatives and you get a rough idea of the size of the market. By comparison, US GDP at the time was about 20 trillion. In this course, we will study the main derivatives instruments and the markets in which they are traded. The course content will mix description, theoretical modeling, and practical application.