Introduction to FINA 4523

Lecture 0: Introduction to FINA 4529

FINA 4529 Hengjie Ai
The Carlson School of Management, University of Minnesota

Undergraduate, Spring 2013

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Finance 4529

Introduction

Introduction to FINA 4523

Outline of the Lecture

Introduction to FINA 4529 Logistics Group Presentation

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Finance 4529

Introduction

Introduction to FINA 4523

Introduction to FINA 4523

An Overview

Part 1: The Black-Scholes Model and Applications

The Black-scholes model Delta Hedging and Other Greek Letters Implied Volatility

Part 2: Applications
Portfolio hedging Credit Derivatives Pricing sophisticated nancial products

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Finance 4529

Introduction

Introduction to FINA 4523

Introduction to FINA 4523

An Overview

Part 3: Addtional Topics in Derivatives

Option Trading Strategies (Lecture) HBS Case: First American Banks: Credit Default Swaps (Presentation) The Credit Derivatives Market (Presentation) The Fundamental Problem of Debt and Equity (Presentation) Does Trading on Wall Street Benet People on Main Street? (Presentation)

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Finance 4529

Introduction

Introduction to FINA 4523

Introduction to FINA 4523

Logistics

Textbook and additional readings

Robert McDonald, Fundamentals of Derivatives Markets, 1st edition, Addison Wesley. Alternatively, Robert McDonald: Derivatives Markets, 2nd edition, Addison Wesley. Handouts

Moodle website: moodle2.umn.edu O ce Hour: Tuesday 3:00-4:00pm

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Finance 4529

Introduction

Introduction to FINA 4523

Introduction to FINA 4523

Grading

Homework
Must be typed, late homework not accepted. Team: 4-5 members, Signup sheet at the beginning of the second day of class. Best four out of ve homework will be counted; No makeup homework.

Quizzes:
every Tuesday, beginning of class Best of four of ve counted; no make-up quiz

Group presentation:
Tuesday of last week. 70% grade from peers, 30% grade from instructorAfter class

Grading: HW (20%), Quizzes (20%), Group Project (20%), Final Exam (40%).
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