No.

of Printed Pages : 2 MFP-002

MANAGEMENT PROGRAMME/
POST GRADUATE DIPLOMA IN
FINANCIAL MARKETS PRACTICE
Term-End Examination
U 4-17 December, 2019

MFP 002 : EQUITY DERIVATIVES

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Time : 3 hours Maximum Marks : 100

Note : Attempt any five questions. All questions carry
equal marks.

1. What do you understand by the term

Derivatives ? Describe the different types of
Derivative contracts. How are Derivatives
useful ?

2. Discuss the relationship between Spot and

Futures prices. Describe Contango and
Backwardation and explain the situations in
which they prevail.

3. Explain the following :

(a) Hedging
(b) Speculation
(c) Arbitrage
(d) DELTA

MFP-002 1 P.T.O.
4. What are Rights Issues ? Explain the adjustment
for Derivative contract when a company
announces Rights Issue.

5. Discuss the various factors that impact the Put

Option prices.

6. Explain the Covered Call strategy and Collar

strategy applied for using hedging options.

7. What do you understand by Value at Risk ? How

is VaR computation carried out for longer
horizons ? Discuss the refinements made in VaR
computations.

8. Discuss the guidelines and principles of

International Accounting for Options.

MFP-002 2 1,500