Stock Options and Equity Derivatives

Our Equity Derivatives training course covers the incredible range of products that are available for market participants. We’ll start with a brief overview of financial derivatives and equity futures and then focus in greater detail on option contracts, exploring such areas as option risks and pricing, exotic variations and volatility trading.

This advanced course is aimed at those who have some understanding of equity markets and its key concepts. A basic level of derivatives knowledge is also recommended, although not required.

• Free eBook "How To Start Trading Stocks" - download

What will you learn?

By the end of the course, you will:

• Gain a solid understanding of equity futures, options and swap contracts, as well as their uses, pricing and risks.
• Discover what impact the dividends have on futures term structure and option valuation.
• Find out when it is optimal to exercise an American option early (when it’s not).
• Appreciate the diverse range of option strategies and their suitability for different market conditions.
• Recognize the interplay between option risks and how they relate to one another.
• Become familiar with various exotic features of equity derivative contracts.
• Be able to calculate implied and realised correlations in the market.
• Find out about equity structured products and how investors use them to maximise returns.
• Grasp the specifics of trading volatility with VIX futures and options.
• Become confident when dealing with equity derivatives.
• And much more!

Course Content:

Day 1

1. Overview of Financial Derivatives:
   
   • Users of equity derivatives.
   • Types of derivative products.
   • Open interest and volume.
   • Listed and OTC trading.
   • Derivatives settlement procedures.
     
     
2. Equity Futures and Forwards:
   
   • Mechanics of a forward contract.
   • Cost of carry and fair value.
   • Impact of dividends, interest rates and borrow cost.
   • Using futures for hedging, speculating and asset allocation.
   • Equity futures and stock index futures.
   • Dividend futures.
     
     
3. Options:
   
   • Calls and puts.
   • Selling and buying of options.
   • In-the-money (ITM), At-the-money (ATM) and Out-of-the-money (OTM) options.
   • Motivation behind using options.
   • Put-call parity and option arbitrage.
   • Overview of stock and index option contracts.
     
     
4. Option Pricing:
   
   • Intrinsic and time value.
   • Black-Scholes framework.
   • Delta hedging.
   • Pricing European and American options.
   • Realized volatility.
   • Implied volatility and volatility surface.
     
     
5. The Impact of Dividends:
   
   • Overview of dividend payments.
   • Dividends and early exercise.
   • Continuous vs discrete dividends.
   • Pricing options with dividends.
   • Implied dividends and dividend forecasting.
     
     
6. Option Risks and Greeks:
   
   • Delta.
   • Gamma.
   • Vega.
   • Rho.
   • Theta.
   • Hedging of the risks.

Day 2:

1. Option Strategies:
   
   • Straddles and strangles.
   • Call and put spreads.
   • Calendar spread.
   • Butterfly.
   • Collar and risk-reversal.
   • Iron Condor.
     
     
2. Light Exotic Options:
   
   • Barrier options.
   • Knock-in/out options.
   • Digital and binary options.
   • Quanto options.
   • Asian contracts.
     
     
3. Equity Swaps:
   
   • Synthetic equity.
   • Vanilla Equity Swap.
   • Total Return Swaps.
   • Dividend swaps.
     
     
4. Volatility and Correlation Trading:
   
   • Variance and volatility swaps.
   • Implied and realized correlation.
   • The VIX index.
   • VIX futures and options.
   • Volatility complex – ETNs and ETPs.
   • Dispersion strategies.
     
     
5. Structured Products:
   
   • Options as a note contract.
   • Autocallables.
   • Reverse convertibles.
   • Protected participation.
   • Bonus certificate.

What’s the format?

• Dynamic in-class lectures.
• Practical assignments and exercises.
• Interactive demos and examples.
• Challenging quizzes and tests.

What will you get upon completion?

• Formal completion certificate.
• Course notes and materials.
• Follow-up support – ability to ask questions and seek further clarification, if needed.
• 20% OFF any future courses you wish to attend.

Want to run this training in-house?

Get in touch! All our training courses can be tailored to your company needs and requirements. Feel free to drop us a message and we’d be happy to help.

• Private traders and investors, looking to learn about equity derivatives markets.
• Professionals within the financial industry or those providing services to the financial sector.
• Professionals performing financial functions in non-financial industries, such as corporate treasury, accounting, and investor relations.
• Students, preparing for an upcoming internship or starting their careers in finance.
• Anyone working in or looking to understand how equity derivatives work.

This advanced course is aimed at those who have some understanding of equity markets and its key concepts. A basic level of derivatives knowledge is also recommended, although not required.

Certificate of completion

Digital certificate - Included