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SHU BFIN 4234 BFIN 7331 - Futures, Options and Other Derivatives

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---- SPRING 2025 LECTURES ---
Columbia ERM 5001 Intro to Finance
Fordham FNBU 3446 Deriv. - Tue
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SHU BFIN 4255 Fin. Model Tue/Thu
SHU BFIN 4261 Private Equity
SHU BFIN 4234/7331 Derivatives
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The course is designed to introduce theoretical and practical applications of financial futures, options and other derivatives such Swaps, Swaptions and FRAs.  Over the last 30 plus years, with the expansion of hedge funds, the markets for these asset classes have grown enormously and has generated innovative techniques for hedging, speculating or arbitraging investments. Derivatives have become one of the most important tools of modern finance. We will examine the institutional aspects of futures, options and swap markets and provide an analytical foundation for the pricing these instruments. The subject matter requires relatively greater use of quantitative methods including the binomial option pricing model as well as the classic model of Black-Scholes-Merton.
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Course Outline -  Lectures , Assignments and Exams

INFO:

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Syllabus

Syllabus Spring 2025

Professor's Inbox
(upload info for Professor)

Professor's Inbox

Processor's Email

Office Hours
In person
 

Tuesdays and Thursdays 9:30-11:00am

JH ROOM# 691

Zoom Channel

Zoom Link to Class (Hybrid for Graduate Students)

Text Book

Supplemental Textbook

Professor's Biography

Professor's Biography

Office Hours/Remote
(9:00-5pm)

Make an Appointment Link

THURSDAYS

6:30-8:40PM

Jan 16 On-Line

Jan 23 

Jan 30

Feb 6

Feb 13

Feb 20

Feb 27

Mar 6

Mar 13

Mar 20
Remote on-line Via Canvas

Mar 27

Apr 3

Apr 10

Apr 17

Apr 24

May 1

May 8

   

OPTION STRATEGIES AND VALUATION

         

N

O

 

C

L

A

S

S

     

FUTURES, FORWARDS, SWAPS, CDS AND FRA's

EQUITY
VALUATION

   

supplemental_textbook.jpg

      Chapter    13

Introduction & Structure of Derivatives Markets 

Chapter 13 

Basic Option Strategies 

Chapter 13 

Advanced Option Strategies 

Chapter 13 

Spread  Option Strategies 

Chapter 13
 
Review of all Options (Basic, Covered Strategies and Advance Strategies) 

Chapter 13

Intro to Binomial Pricing Model - Method #1

 The Binomial Model -  Single and Multi-stage Approach

 

In-Class Practice

Chapter 13

Option Pricing Models:

The Black-Scholes-Merton Model 

EXAM REVIEW
(Pre-Recorded on Zoom - see link below)

Midterm Exam - Options

Options Formula

Options Practice Sheet with Answers

 

MIDTERM EXAM RESULTS REVIEW

Chapter 14

Forwards & Futures

Chapter 14

Swaps andTRS

Chapter 14 and Handout
 
Credit Swaps, FRAs
and CDS

Instructor's Notes:
 
 Equity Valuations using Options approach
 

Exam Review

 

Assigned Lectures

Introduction to Derivatives

Options: Concepts, Strategy and Valuations

Options: Concepts, Strategy and Valuations

Options: Concepts, Strategy and Valuations

Options: Concepts, Strategy and Valuations

Options: Concepts, Strategy and Valuations

     

Options: Concepts, Strategy and Valuations

Futures, Forwards & Swaps

Futures, Forwards & Swaps

 

Valuation of start-up businesses using Black-Scholes Options Pricing Model

Final Exam Review

 

Zoom Recordings

Zoom Recording 1/16 Intro to Course

Zoom Recording 1/23

                           

Lecture on YouTube

 

Introductions to Options and Basic Strategies

JD.com Call Option

JD.com Options - Yahoo Finance

Nike - Bear Put Spread

Nike Options - Yahoo Finance

Introduction to Option Valuation

One-Period BOPM (Leverage & Probability Method) Call Option 1/3

 

Two-Period BOPM - Call Option 2/3

Two-Stage BOPM - Put Option 3/3

         

Interest Rate Swaps - The Basics 1/3

Interest Rate Swaps and benefits 2/3

Simple Interest Rate Swaps 3/3

Currency Swaps & CDS

       

Assigned Spreadsheets

 

Basic Option Strategies (Protective Puts, Covered Calls, Collars)

Excel Template: Options: Concepts, Strategy and Valuations

Advanced Strategies (Bull, Bear, Butterfly Spreads)

Spread Options In-Class Examples

 

Bionomial Option Pricing Model Method 1 (6-step Method)

BOPM (single and 2-period) Method 2

     

Black Scholes Option Model

Futures & Forwards

Chapter 14 - Futures, Forwards & Swaps

SWAPS

Total Return Swaps (TRA)

 

SaaS IP Case Study - OPM Valuation

Distress Company Valuation using Black Scholes - Spirit Air Bankruptcy

SaaS IP Case Study - OPM Valuation

Distress Company Valuation using Black Scholes - Spirit Air Bankruptcy

 

EXAMS

               

MidTerm online via Canvas

           

Final Exam

Question 8 Take Home Exam - Bonus Points

Question 8 Template

Midterm_Exam_Questions_1_2

Options Practice Sheet with Answers

Options Formula

Homework Assignments

     

Homework #1

Homework found on Canvas with spreadsheet template

Homework #2

Homework found on Canvas with spreadsheet template

Homework #3

Homework found on Canvas with spreadsheet template

Homework #4a nd 4b

Homework found on Canvas 

Homework #5

Homework found on Canvas with spreadsheet template


     

Homework #6

Homework found on Canvas with spreadsheet template


Homework #7a and 7b

Homework found on Canvas with spreadsheet template


Homework #8

Homework found on Canvas with spreadsheet template


   
Reading Assignments

textbookfirsteditionV2.jpeg.jpg

 An Analytical Approach to Investments Finance & Credit (1st Edition)

C.Droussiotis,  Cognella Publishing 

To Purchase Textbook

ARTICLE: GameStop's Gargantuan Gamma Squeeze

GameStop Charts

Greeks in Finance

SIFMA Insights: US Listed Options Primer

Trading and valuing Options

YouTube Link: DVDA Uncovered Put

YouTube Link: Bull Call Spread on Regeneron

         

Article on Black Scholes

Bitcoin Option Calc Using Black Scholes

Horse Racing & Options

CFA BOPM

WSJ Futures Prices

Yahoo Finance Futures Prices

Total Return Swap gone wrong - Article

LIBOR MARKETS Interest Rates

Managing Negative Interest Rates

The Big Short Clip on CDS

     

Practice Sheets

 

Options Practice Sheet with Answers

 

The Greeks in Options Explain

                       
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