Alignment of Program Learning Outcomes and Course Learning Outcomes

Course Learning
Program Learning Outcomes
Outcomes
PLO1. Acquisition of techniques and advanced knowledge in
interdisciplinary fields between finance and other appropriate CLO1, CLO2,
disciplines including but not limited to engineering, law and CLO3, CLO4
mathematics
PLO2. Application and integration of knowledge and skills in finance
and relevant interdisciplinary fields to identify and tackle practical CLO1, CLO2,
problems, and design innovative products and systems with CLO3, CLO4
international standards and global vision
PLO3. Inculcating leadership, professional ethics and competence in CLO1, CLO2,
finance and relevant interdisciplinary fields CLO3, CLO4
PLO4. Mastering communication skills CLO1, CLO4

II. COURSE DELIVERY and COURSE ASSESSMENT

Teaching and Learning Activities
TLA1. Lectures and Class Participation
Thirty-three lecture hours for the whole course dividing into eleven sessions with
three hours per session will be delivered by the instructor. Students are asked to
actively participate in all class discussions. To facilitate students’ learning, several in-
class exercises will be provided. Students are required to bring a calculator to class for
this purpose.
TLA2. Assigned Individual Homework
Students are expected to spend at least 6 hours per week on previewing and
reviewing lecture materials and on individual homework assignments. The assigned
homework is for students to practice on questions and problems in order to strengthen
the knowledge acquisition and to improve the problem solving skills. Answers to the
assignments will be provided afterwards on the course Moodle page for students’
reference.
TLA3. Group Projects
Students will be assigned to a group with four or five members to complete two
projects outside the classroom. This gives students opportunities to apply and
integrate the knowledge learned. By engaging in this exercise, students will not only
learn to work as a team but also develop their spreadsheet skills that are useful in their
future work. The projects will be discussed in class after grading. Students are
expected to spend about 5 hours on each project.
TLA4. Consultation
Instructor offers consultation during class break and after class to address students’
questions. Students are also encouraged to ask questions using Moodle Discussion
Forum or by sending emails to the instructor. Face-to-face or Zoom individual

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 consultation session might be arranged if necessary.

Course Assessment Tasks

Course grade will be based on class participation, three individual homework assignments,
two group projects, and final examination as follows:

AT1 Class Participation 10%

AT2 Individual Assignments 15%
AT3 Group Projects 25%
AT4 Final Examination 50%
Total 100%

AT1. Class Attendance and Participation

Students are encouraged to actively participate in all class activities and discussions.
Class participation can be raising questions and answering questions, making
constructive comments, sharing useful materials and experience, and others. Attendance
will be taken for all lectures. To ensure that students gain the maximum benefit from
classes, students are required to attend at least 70% of classes for each course,
otherwise they may be treated as having failed the whole course.

AT2. Individual Homework Assignments

Students should work individually on three homework assignments and submit the
work by given due date. You do not have to type your solutions, but the writing must be
clear. The individual assignments serve to evaluate students’ acquisition and
internalization of knowledge and techniques contained in the course.

AT3. Group Projects

Students work on two projects in group. Each group submits one report for each project
and all group members must make efforts to contribute. To reduce free-riding problem,
a mandatory peer evaluation will be carried out to determine students’ individual grade
of group work. The projects serve to evaluate students’ ability in applying and
integrating the relevant knowledge in the finance profession.

AT4. Final Examinations

There will be a two-hour long examination at the end of the module. The exam is
designed to assess students’ performance in acquisition, internalization, and application
of knowledge and techniques in the subject of derivatives.

Alignment of Course Learning Outcomes, Teaching and Learning Activities and

Assessment Tasks

Course Learning Outcomes Teaching and Learning Activities Assessment Tasks

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 CLO1 TLA1, TLA2, TLA3, TLA4 AT1, AT2, AT3, AT4
CLO2 TLA1, TLA2, TLA3, TLA4 AT1, AT2, AT3, AT4
CLO3 TLA1, TLA2, TLA3, TLA4 AT1, AT2, AT3, AT4
CLO4 TLA1, TLA2, TLA3, TLA4 AT1, AT2, AT3, AT4

Grading Criteria

Grade Performance
A+, A, A- Strong evidence of superb ability to fulfill the intended learning outcomes of
the course at all levels of learning: describe, apply, evaluate, and synthesis.
B+, B, B- Strong evidence of the ability to fulfill the intended learning outcomes of the
course at all levels of learning: describe, apply, evaluate, and synthesis.
C+, C, C- Evidence of adequate ability to fulfill the intended learning outcomes of the
course at low levels of learning such as describe and apply but not at high
levels of learning such as evaluate and synthesis
D, D- Evidence of basic familiarity with the subject.
F Little evidence of basic familiarity with the subject.

III. COURSE POLICIES

Class Conduct
Students are required to attend all classes on time. If students are 30 minutes late or more,
they might be regarded as not having attended the class. Students are required to tap their
student cards on the card reader for attendance when they enter the classroom as well as when
the class ends (double tapping).
Respect your instructor and your fellow students. Be considerate to others.

Academic Dishonesty
The University Regulations on academic dishonesty will be strictly enforced! Please check
the University Statement on plagiarism on the web: http://www.hku.hk/plagiarism/.
Academic dishonesty is any act that misrepresents a person’s own academic work or that
compromises the academic work of another. It includes (but not limited to) cheating on
assignments or examinations; plagiarizing, i.e., representing someone else’s ideas as if they
are one’s own; sabotaging another’s work.
If you are caught in an act of academic dishonesty or misconduct, you will receive an “F”
grade for the subject. The relevant Board of Examiners may impose other penalty in relation
to the seriousness of the offense.

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IV. COURSE OUTLINE (Subject to Change)
Class A: Mon and Thu 9:30 – 12:30
Class B: Mon and Thu 14:00 – 17:00
Class C: Wed and Sat 9:30 – 12:30 (18:30 – 21:30 on September 16)
Class D: Wed and Sat 14:00 – 17:00 (18:30 – 21:30 on September 23)
Tutorial sessions: Tuesdays 19:00 – 21:00 (TC-B4 /B13)

*: Students are required to attend each session as scheduled. Anyone who would like to sit in
a different class have to first seek for approval from the program office.
*: Check the course Moodle page for lecture notes and more detailed coverage of each
session.

Session Topics Reading

McDonald
Session 1 Introduction to the course and to derivatives in general
Chapter 1

Technical Preparation McDonald

Session 2
Introduction to forward and futures Chapter 2

Futures trading McDonald

Session 3
Pricing of forward and futures Chapter 5

Use of forward and futures McDonald

Session 4
Currency forward and futures Chapter 5

Interest rate forward and futures McDonald

Session 5
Swaps Chapter 7, 8

McDonald
Session 6 Swaps (cont’d)
Chapter 8

Introduction to options McDonald

Session 7
Basic risk management using options and forward Chapter 2, 3, 4

McDonald
Session 8 Parity and other option relationships
Chapter 9

McDonald
Session 9 Binomial option pricing
Chapter 10, 11

Binomial option pricing (cont’d) McDonald

Session 10
The Black-Scholes formula and delta-hedging Chapter 11, 12

The Black-Scholes formula and delta-hedging (cont’d) McDonald

Session 11
Final Review and Q&A Chapter 12, 13

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