Overview

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Master options pricing models and derivatives strategies used in modern financial markets. Learn how to evaluate options, interpret Greeks, and apply swaps for effective risk management. This course provides a structured approach to understanding derivatives with a strong focus on options pricing and practical application. You will begin with the fundamentals of options, including call and put contracts, strike prices, and payoff structures. You will then explore how option prices are determined using key models such as Black-Scholes, while understanding the role of volatility, time to expiry, and market conditions. The course also introduces option sensitivities—Delta, Gamma, Vega, and Theta—helping you measure risk and price movement effectively. As you progress, you will learn to construct synthetic positions and interpret real-world trading scenarios. The course also covers swap instruments, including currency, equity, and credit default swaps, explaining how they are used to manage financial exposure. By the end of the course, you will be able to analyze options pricing, interpret Greeks, and apply derivatives strategies confidently in trading and risk management environments.

Syllabus

Foundations of Options Trading

This module introduces the fundamental concepts of derivatives and options, including call and put options, strike price, expiration, and payoff structures. Learners will build a strong conceptual foundation to understand how options work and how profit and loss are determined.

Practical Options Understanding

This module explores how option prices behave in real-world scenarios by examining factors such as volatility, time to expiry, and pricing models. Learners will understand how different variables influence option premiums and valuation techniques.

Synthetic Positions and Delta Concepts

This module focuses on constructing synthetic positions and understanding delta as a key sensitivity measure. Learners will explore how options replicate other financial instruments and how probability and price movement affect option behavior.

Volatility and Advanced Greeks

This module delves into advanced option pricing concepts, including volatility, Gamma, Vega, and Theta. Learners will develop a deeper understanding of how option sensitivities impact pricing and risk management.

Time Decay and Introduction to Swaps

This module introduces time decay (Theta) and the fundamentals of swaps. Learners will understand how option value erodes over time and how swaps are used to manage financial exposure.

Swap Valuation and Advanced Applications

This module covers advanced swap instruments and valuation techniques. Learners will explore currency swaps, equity swaps, commodity swaps, and credit default swaps, along with their practical applications in financial markets.