Commodities, Derivatives and Structured Products

Forwards & Futures - Part 2



This eCourse consists of three modules. Module 1 outlines the distinctive features of the futures market. It gives a snapshot of a rapidly evolving marketplace; products change, exchanges multiply and consolidate, and the very essence of trading is constantly in flux. A view of the current 'state of the game' is given, together with a more general description of the foundations of the futures industry.

Module 2 explains the basic principle behind hedging using 'prices in the future' and shows how this principle is applied across many markets. It also outlines the differences between, and relative attractions of, using either futures contracts or OTC forwards when hedging a position. The additional difficulties of hedging interest rate risk are covered in Module 3.

Module 3 focuses on the hedging of interest rate risk, both for shorter-dated and longer-dated instruments. It examines the construction of hedges using bond and money market futures, and outlines some of the particular issues unique to these markets.


On completion of this course, you will be able to:
- Describe the development of the futures markets, both in multiple locations and in different products
- Identify the key features of futures contracts, and how they are margined and cleared
- Describe the evolution of the different trading methods in the futures markets
- Explain how futures contracts and forward trades are used to hedge an existing or anticipated asset position
- Compare and contrast hedging using futures with hedging using forwards
- Outline some of the different hedging approaches used in different markets
- Identify the different long-term interest rate risks faced by market participants
- Explain how long-term interest rate risks can be managed, particularly through hedging using bond and swap futures
- Identify the different short-term interest rate related risks faced by market participants, and explain how these risks can be managed, either through OTC FRA transactions or through the use of money market futures contracts


Module 1: Futures Markets
Topic 1: The Growth of Futures Markets
Topic 2: Characteristics of Futures Contracts
Topic 3: Trading in Futures

Module 2: Forwards & Futures - Hedging (Part I)
Topic 1: Simple Hedges
Topic 2: Futures or Forwards
Topic 3: Hedging Other Major Assets

Module 3: Forwards & Futures - Hedging (Part II)
Topic 1: Bond Futures
Topic 2: Hedging Using Futures
Topic 3: Short-Term Hedging


SFC:3.50, PWMA:3.50
機構會員員工: HK$1015
非會員: HK$1435
所有會員: HK$1015