Paper No. 16 Derivatives Analysis

UNIT DESCRIPTION
This paper is intended to equip the candidate with the knowledge and skills that will enable
him/her to analyse and trade in the various types of derivative investments.
LEARNING OUTCOMES
• Demonstrate an understanding of the features, structure and operations of derivatives
markets
• Develop a framework for pricing various types of derivatives
• Value derivative instruments using discrete time and continuous time valuation
principles.
• Price and hedge interest rate swaps
• Use financial derivative instruments for managing and hedging portfolio risk.
• Apply the framework for risk management so as to enable identification, assessment and
control of numerous sources of risk