KTTS4140 Derivatives (5 cr)

Study level:
Advanced studies
Grading scale:
Responsible organisation:
Jyväskylä University School of Business and Economics
Curriculum periods:
2020-2021, 2021-2022, 2022-2023, 2023-2024


The lecture course gives a comprehensive treatment of derivatives and risk management. Key points of the lecture course are derivatives pricing, the Black-Scholes-Merton model, risk neutral pricing, tree models, numerical methods, Value-at-Risk, Expected Shortfall, market and credit risks and instruments applied to hedge these risks, portfolio optimization with nonlinear risk measures.

Learning outcomes

On successful completion of the course, students will be able to:
- recognize, report, and apply theories of derivatives pricing
- evaluate return and risk potential of sophisticated derivative instruments and structures, and calculate their market values
- analyze and plan risk management solutions and make decisions regarding risk management

Additional information

Recommended timing for BIF students: 1st year.
Recommended timing for Finnish M.Sc. degree students: 3rd or 4th year.

Description of prerequisites

KTTS4130 Asset Pricing and Investments
KTTS1110 Mathematical Economics II
In addition it is recommended that students know the basic econometric methods (for example KTTA1120 Econometrics I) and master theories of financial economics.

Study materials

Lecture materials will be provided by the instructor.


  • Hull, J. 2017. Options, Futures, and Other Derivatives, 10th edition.

Completion methods

Method 1

Lectures, home assignments, case study, and a written exam
Evaluation criteria:
Grade = 0.2xHome assignments + 0.3xCase Study + 0.5xExam
Select all marked parts
Parts of the completion methods

Lectures (5 cr)

Participation in teaching
Grading scale:
Evaluation criteria:
Grade = 0.2xhome assignments + 0.3xcase study + 0.5xExam
Study methods:

Lectures, home assignments, case study and a written exam

Study materials:

Lecture material and textbook

  • John C. Hull (2017). Options, Futures, and Other Derivatives. 10th edition, London,Pearson.