course bundle
OPTION ESSENTIALS
Courses Info
This course introduces the basic types of options and explains how they work, the nomenclature of options as well as the components that make up the value of an option. It also covers the main uses of options, namely for hedging risks and for earning a profit for taking risks. Lastly, it outlines a medley of options with various underlying assets or instruments delves into the Black–Scholes model for the valuation of European options and concomitant risks.
- Know the similarities and differences between futures and options.
- Know that options provide asymmetric risk–reward trade-offs compared to a spot trade or futures contract.
- How to relate the value of an option to its “time value” and “intrinsic value” components.
- Learn that there is a wide variety of choices when it comes to hedging risks.
- Learn about options linked to stock indices, bonds, interest rates and currencies.
- Encounter the Black–Scholes model and the notion of implied volatility.
- Learn the mechanics of an option contract and its P&L computation.
- How to classify an option as in-the-money, at-the-money or out-of-the-money.
- How to compute the breakeven price for an option trade.
- See examples that compare the outcomes from using futures contract and option for hedging risk, and for speculation.
- Learn how various factors such as spot price, interest rates and volatility affect an option’s value.
- Know the risk measures typically associated with an option.
Courses syllabus
| title | estimate time |
|---|
| Option Essentials | |||
| Option Part 1 | 40:00 | ||
| Option Part 2 | 40:00 | ||
| Uses of Options | 25:00 | ||
| Types of Options Part 1 - Stock Index Options and Interest Rate Options | 25:00 | ||
| Types of Options Part 2 - Currency Options and Determinants of an Option's Value | 30:00 | ||
| Types of Options Part 3 - Options Valuation and Risk Measures | 20:00 | ||
Dr Chan Onn
Lead Content Expert
Dr Chan has more than 30 years of mathematical and financial expertise in both academic and corporate organisations.
