Undergraduate Courses


This course is designed as an introduction to the markets for derivatives. It covers most of the widely used derivative securities in practice, such as futures contracts, interest-rate and currency swaps, and various options. During the course we shall discuss, among others, the uses of derivatives in risk management, valuation of derivatives, the risk-neutral valuation principle, the Black-Scholes formula, binomial trees approach and portfolio insurance. Though not a prerequisite, a minimum background in corporate finance and/or financial markets will be desirable. Students are advised to take ECON2011 and 2021 before taking this course.

1st Term
2nd Term
ECON4450 Teacher: Prof. DU Julan [Course Outline]