LBUSI5105 Financial Risk Management Course Descriptor subject to approval

Course Overview

This course introduces and explores financial risk management using derivative instruments, which are contracts whose values derive from prices of underlying assets and goods such as equities, currencies, debt, and commodities. The main focus is on the valuation and application of the principal derivative building blocks, including fixed income securities, futures and forward contracts, options, and structured financial products. Coverage includes market structure, and to how these products are specifically used by corporations and financial institutions for controlling financial market risks. The course keeps abreast of global developments and new product innovations.

Learning Outcomes

On successful completion of the course, students will be able to:

Knowledge and Understanding

Subject Specific Skills

Transferable and Professional Skills

Teaching and Learning

Teaching and learning strategies for this course will include: 

A minimum of 36 contact hours, typically to include interactive group teaching, co-curriculars, individual meetings, in-class presentations and exams.

Course information and supplementary materials are available on the University’s Virtual Learning Environment (VLE).

Students will receive individualised developmental feedback on their work for this course.

Students are required to attend and participate in all the formal and timetabled sessions for this course. Students are also expected to manage their directed learning and independent study in support of the course.

Assessment

Both formative and summative assessment are used as part of this course, with purely formative opportunities typically embedded within interactive teaching sessions, office hours, and/or the VLE.

Summative

Further information can be found in the Course Syllabus.

Feedback

Students will receive formative and summative feedback in a variety of ways, written (e.g. marked up on assignments, through email or the VLE) or oral (e.g. as part of interactive teaching sessions or in office hours). 

Indicative Reading

Note: Comprehensive and current reading lists for courses are produced annually in the Course Syllabus or other documentation provided to students; the indicative reading list provided below is used as part of the approval/modification process only.

Books

• Core textbook: Hull, J.C. Fundamentals of Futures and Options Markets, John C. Hull, Prentice-Hall. 8th edition or later is acceptable.

Journals

Electronic Resources

• Risk Management Magazine
• Risk.net
• The RMS blog

Indicative Topics

Students will study the following topics:

• Risk and diversification
• Interest rates and interest rate hedging
• Options markets
• Option pricing
• Options risk (“Greeks”)
• Value at Risk (VaR)

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