COURSE INFORMATION

1 . Name of Course Financial Derivatives

2 . Course Code GFF6333 / BFN3144
3 . Type of Course Specialization: Bachelor of Finance (Hons) & Bachelor of Financi
(e.g. : Core, major, elective etc.) (Hons)
4 . Synopsis This course explains the structure, operation and products traded
Malaysia Derivatives. This helps students to grasp an understand
market and appropriate strategies.
5 . Version Current: ADC Sept 2022
(State the date of theSenate’s approval - previous and the current approval date) Previous: Feb 2020

6. Name(s) of Academic Staff Dr Nguyen Thi Phuong Lan

7. Trimester and Year Offered Trimester 2, Second Year(Gamma); Trimester 1, Third Year(Delta
8. Credit Value 3
9. Pre-Requisite GNF6213/ BFN2114 Investment
10 . Objective of the course in the programme:
The course is aimed at developing an understanding of financial derivatives instruments. This comprehensive course covers principles, innovation, and strategies of
instruments, with emphasis on the applications in Malaysia.
11 . Justification for including the course in the programme:
This subject comprises both theoretical and practical knowledge in financial derivatives markets and products.

12 . Course Learning Outcomes (CLO) Domain Leve

CLO1: Discuss the concepts and structure of the derivatives markets.
Affective 2

CLO2: Discuss the uses of forward, futures, swap and options.

Affective 2

CLO3: Apply hedging, arbitraging and speculative trading strategies using derivatives
contracts. Cognitive 3

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 CLO4: Apply derivatives pricing models to estimate the fair value of derivative instruments.
Cognitive 3

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 13 . Mapping of the Course Learning Outcomes to the Programme Learning Outcomes, Teaching Methods and Assessment:

Course Learning Programme Learning Outcomes (PLO) Teaching Methods Assessment

Outcomes (CLO)
(Must tally with CLOs in
item 12) P P P
P P P P P P P P P L L L
L L L L L L L L L O O O
O O O O O O O O O 1 1 1
1 2 3 4 5 6 7 8 9 0 1 2
CLO1 ✓ Project Project
CLO2 ✓ Project Project
CLO3 ✓ Lecture, tutorial Mid-term exam, Final ex
CLO4 ✓ Lecture, tutorial Mid-term exam, Final ex
Indicate the relevancy between the CLO and PLO by ticking “ü” the appr
(This description must be read together with standards 2.1.2, 2.2.1, and
Total 2 2 pages 16 & 18 of COPPA 2.0)

14 . Transferable Skills:

15 . Distribution of Student Learning Time (SLT)

Teaching and
Learning Activities
Guided Independent
Course Content Outline **CLO Guided Learning Learning Learning
(F2F)* (NF2F)* (NF2F)*
*L *T *P *O

Overview of Derivatives
What are derivatives? ;The exchanges, the clearing
1 house, intermediaries in the futures and options markets; 1 2 1 3
Users of futures and options and regulations; clearing and
risk management

Introduction to Forward
2 How over-the counter market works; basic concept of 2 1 1 2
forward; uses of forward contract

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 Introduction to Futures
3 How the futures markets work; Using futures to hedge, 2 1 1 4 2
speculate and arbitrage

Commodity Futures
4 Crude palm oil futures (CPO); Using CPO futures to 2,3,4 2 1 3
hedge, speculate and arbitrage

Equity Futures
Overview of equity futures; Using stock index futures to
5 2,3,4 2 1 2 3
hedge, speculate, arbitrage, and other uses of equity
futures

Interest Rate Futures

6 Overview of interest rate futures: Using interest rate 2,3,4 2 1 2 3
futures to hedge, speculate and arbitrage

Introduction To Options
7 What are options?; How options are traded, payoff 2,3,4 2 1 2 2
diagrams and uses of options

Option Strategies
8 Various options strategies, their payoff diagrams, and 3 4 3 2 7
when to use them. Put-call parity function.

Option Pricing
Basic pricing - Binomial Options Pricing Model and Black-
9 Scholes Options Pricing Model; Discussions on concepts 4 2 2 2 5
of delta, implied volatility and other issues in options
pricing

Uses of Equity Options

10 2 1 1 2
The use of options in corporate finance

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 Swaps
11 The use and mechanics of interest rate swaps, currency 2,3 1 1 2 2
swap and credit default swap
Total SLT

SUMMATIVE ASSESSMENT
1. Continuous Assessment Percentage % Total S
Mid-term exam 20% 6
Project 30% 12

Total SLT for Continuous Assessment 18

Total S
2. Final Assessment Percentage %
F2F
Final exam 50% 2
Total SLT for Final Assessment (F2F + NF2F) 18

Grand Total 100% 120

**Indicate the CLO based on the CLO’s numbering in Item 12.
*L= Lecture, *T= Tutorial, *P= Practical, *O= Others, F2F*= Face to Face, NF2F*= Non Face to Face

16 . Identify Special Requirement to Deliver the Course (e.g., software, nursery, computer lab, simulation room):
Nil
17 . Main References:
Obiyathulla Ismath Bacha (2017) Financial Derivatives: Markets and Applications in Malaysia (Fourth Edition), McGraw-Hill.
18 . Additional References:
1. Hull, J.C. (2016) Fundamentals of Futures and Options Markets, 9th Edition, Pearson.
2. Hull, J.C (2017) Options, Futures and Other Derivatives, 10th Edition, Pearson.

Note:
Cells shaded light grey contain formulas / fixed values. Edit these formulas only if needed.

This Course Information document is the property of Multimedia University (“MMU”). It contains proprietary and confidential information and is meant for internal use only. Any sharing or distribution with any external party
unless prior consent or approval is obtained from MMU.

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s) & Bachelor of Financial Engineering

tion and products traded under Bursa

s to grasp an understanding on derivatives

ester 1, Third Year(Delta)

vation, and strategies of various derivatives

Level

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 3

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 Assessment Method

Project
Project
Mid-term exam, Final exam
Mid-term exam, Final exam
PLO by ticking “ü” the appropriate relevant box
tandards 2.1.2, 2.2.1, and 2.2.2 in Area 2 –

Independent
Learning Total SLT
(NF2F)*

3 6

2 4

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2 8

3 6

3 8

3 8

2 7

7 16

5 11

2 4

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 2 6

Total SLT 84

Total SLT
6
12

18

Total SLT
F2F ILT
2 16
18

120

ibution with any external party is strictly prohibited

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