THE UNIVERSITY OF MELBOURNE 
FNCE30007 - Derivative Securities 
Final Examination Guide and Notes 2024 
 
Part 01. About This Guide 
Part 02. Sample Final Examination Paper 
Part 03. Suggested Solutions to Final Exam Paper 
Part 04. Final Examination - Hints and Tips 
 
The 24/7 Online Support You Deserve
Need to reach out to us with questions or for help? You'll connect with a private tutor who is extremely passionate about the subject, ready to provide assistance and ensure that you're on the right track to graduating.
 
Looking for additional study resources?
Explore the most up-to-date revision notes and exam guides available for students at the University of Melbourne.

University of Melbourne - FNCE30007: Derivative Securities

$35.00

ACADEMIC YEAR 2023 - 2024

University	University of Melbourne
Study Level	Undergraduate
Subject Code	FNCE30007
Subject Name	Derivative Securities
Notes Title	Final Examination Guide and Notes
Page Length	30

This comprehensive study material provides an excellent opportunity for students to familiarise themselves with the content and format of the updated final examination for FNCE30007: Derivative Securities at the University of Melbourne in 2024. The guide offers practical exam techniques that can assist you in tackling challenging questions in the end-of-semester final examination. It also focuses on core exam questions and uses clear, simple diagrams that are easy to understand and recall during the actual test. By utilising this comprehensive study material as a resourceful tool, you can approach your final exam confidently knowing that you have acquired all necessary knowledge and skills required for success.

This subject focuses on the application and valuation of derivative securities, such as forwards, futures, swaps and options. The emphasis will be on arbitrage relations, valuation, and hedging with derivatives. The topics covered include; Forwards and futures: the mechanics of trading, price determination, hedging strategies; Swaps: definition and valuation; Options: payoffs, arbitrage bounds, trading strategies, the binomial model, the Black-Scholes model and its relationship to the binomial, hedging, American options and dividends, options on futures, limitations of the binomial and Black-Scholes Models.

✔ On successful completion of this subject, you should be able to:

explain the role of derivatives exchanges and the characteristics of derivative securities;
explain the role of arbitrage as a basis for determining the prices of derivative securities;
explain the mechanics of trading futures contracts, forward contracts and options;
design and manipulate payoff diagrams for various derivative securities;
calculate option prices using the Black-Scholes and binomial models;
explain how derivative securities can be used in hedging; and,
reflect on the theoretical limitations of key derivatives pricing models and on practical difficulties that arise in their implementation.

SUBJECT CODE	SUBJECT NAME
ACCT10001	Accounting Reports and Analysis
ACCT10002	Introductory Financial Accounting
ACCT20001	Cost Management
BLAW10001	Principles of Business Law
BLAW30002	Taxation Law I
ECOM20001	Econometrics 1
ECOM30002	Econometrics 2
ECON10003	Introductory Macroeconomics
ECON10004	Introductory Microeconomics
ECON10005	Quantitative Methods 1
ECON20002	Intermediate Microeconomics
ECON20003	Quantitative Methods 2
FNCE10002	Principles of Finance
FNCE20005	Corporate Financial Decision Making
FNCE30001	Investments
FNCE30007	Derivative Securities
FNCE40001	Advanced Corporate Finance
MAST20005	Statistics
MGMT10002	Principles of Management
MKTG10001	Principles of Marketing

University of Melbourne - FNCE30007: Derivative Securities

INFORMATION

SUBJECT DESCRIPTION

RELATED SUBJECTS