Program Overview

Unit of Study FIN10712 - Financial Risk Management

Unit Snapshot

• Unit type: UG Coursework Unit
• Credit points: 12
• AQF level: 7
• Level of learning: Advanced
• Former School/College: Former School of Business and Tourism
• Pre-requisites:
  • FIN10254 - Financial Institutions, Instruments and Markets
  • FIN10709 - Foundations of Finance
  • 120 credit points in any SCU units
• Enrolment information: N/A

Unit Description

This unit provides an introduction to financial risk management. It deals with the investment decision-making process, derivative markets and securities, pricing, risk management, and trading strategies. Topics include: forwards and futures, options, warrants, swaps, exotics, derivative valuation models, and hedging and trading techniques.

Unit Content

• Topic 1: Introduction to derivative markets
• Topic 2: The mechanics of forward and futures market
• Topic 3: Principles of pricing forward and futures
• Topic 4: Hedging strategies using forward and futures
• Topic 5: Swaps
• Topic 6: The mechanics of options markets
• Topic 7: Option pricing models: Binomial and Black-Scholes-Merton
• Topic 8: Trading strategies involving option
• Topic 9: Financial risk management techniques and applications
• Topic 10: Derivatives mishaps and lessons

Availabilities

Learning Outcomes and Graduate Attributes

Unit Learning Outcomes express learning achievement in terms of what a student should know, understand, and be able to do on completion of a unit. These outcomes are aligned with the graduate attributes.

On Completion of This Unit, Students Should Be Able To:

1. Evaluate risks associated with financial asset ownership
   • GA1: Intellectual rigour
   • GA2:
   • GA4: Knowledge of a discipline
2. Discuss the characteristics of financial derivative securities
   • GA4: Knowledge of a discipline
   • GA7: Cultural competence
3. Value financial derivatives using appropriate models
   • GA1: Intellectual rigour
   • GA4: Knowledge of a discipline
4. Implement risk management and trading strategies using financial derivatives
   • GA1: Intellectual rigour
   • GA2: Creativity
   • GA4: Knowledge of a discipline
5. Discuss the value of derivative securities in the current financial environment
   • GA1: Intellectual rigour
   • GA2: Creativity
   • GA4: Knowledge of a discipline

Prescribed Learning Resources

Session 2

• Prescribed Texts: No prescribed texts.
• Prescribed Learning Resources may change in future Teaching Periods.

Graduate Attributes

• GA1: Intellectual rigour - A commitment to excellence in all scholarly and intellectual activities, including critical judgement.
• GA2: Creativity - An ability to develop creative and effective responses to intellectual, professional, and social challenges.
• GA3: Ethical practice - A commitment to sustainability and high ethical standards in social and professional practices.
• GA4: Knowledge of a discipline - Command of a discipline to enable a smooth transition and contribution to professional and community settings.
• GA5: Lifelong learning - The ability to be responsive to change, to be inquiring and reflective in practice, through information literacy and autonomous, self-managed learning.
• GA6: Communication and social skills - The ability to communicate and collaborate with individuals, and within teams, in professional and community settings.
• GA7: Cultural competence - An ability to engage with diverse cultural and Indigenous perspectives in both global and local settings.