Financial Markets

Introduction to Derivatives and Hedging: Part 2 of 3

Course Overview:

This course focuses on two specific types of derivative instruments: forward contracts and futures contracts. The course begins with an overview of forward contracts and a description of the unique characteristics of those contracts. Hedging practices through the use of forward contracts is reviewed, and the calculation of a forward contract's payoff is exhibited with examples and illustrations. Forward pricing is discussed and foreign exchange forwards and forward rate agreements are further defined and explained. The course concludes with a detailed review of futures contracts, and the subcomponents of futures markets, including futures exchanges, standardization features of futures contracts, market mechanics, the concept and use of futures margin and margin requirements, and the futures exchange clearinghouse, through which futures trades are cleared.

Learning Objectives:

After completing this course, the course participant should be able to:
  • Identify the unique characteristics of forward contracts.
  • Recognize appropriate hedging practices using forward contracts.
  • Identify the differences between futures and forwards.
  • Recognize the financial and operational risks associated with using futures contracts as hedging tools.

  • Content Partner:

    SmartPros Ltd.

    SmartPros Ltd. is a leader in online and offline continuing education for
    accounting, finance and engineering professionals. With over 2,000 hours of
    content, SmartPros has been providing mandatory continuing education
    products since 1981. SmartPros provides services and content to its
    professional and corporate clients, in a variety of media including Web, CD
    ROM, and video. In the accounting market, SmartPros also has a predominant
    news and information portal which receives 200,000+ visits per month and
    provides services to over 100,000 subscribers. SmartPros' customers include
    50% of the Fortune 500, as well as the major firms and associations in each
    of its professional markets.

    Prerequisites/Advanced Preparation:

    Knowledge of accounting and finance concepts, and basic derivatives terminology and mechanics

    Speaker / Author:

    Michael J. Walker
    Mich'l J. Walker, CPA
    Mich'l J. Walker is a New England-based Certified Public Accountant with over fourteen years of accounting experience in the financial services, information technology services and construction industries. He is currently a Vice President at one of the largest financial institutions in the world. He has an extensive technical accounting background that includes hands-on experience with U.S. GAAP, Canadian GAAP and International Financial Reporting Standards (IFRS). His expertise includes the accounting for derivatives, fixed income investments & securitizations. He graduated from Bentley University with a B.S. in Finance (1995) and a M.S. in Accountancy (2000).

    Software & Hardware Requirements:

    • 56k or Greater Internet Connection
    • Adobe Acrobat® Reader for the .pdf files
    • Adobe® Flash® Player 9 or higher
    • Modern DHTML Compatible Browser
    • Ram: 256 MB minimum
    • Windows or Mac OS


    Price (USD)

    Standard Rate: $49.90


    Course Code : 99WAL03b-v2

    Release Date : 03/24/2015
    Expire Date : 07/01/2020
    Credits :
    CPE 2.00
    QAS 2.00

    Course Level : Basic
    Course Type : New Standards
    Length : 1hr 40min
    Passing Grade : 70%
    Field Of Study : Finance
    Theme : Financial Markets

    Format Type : eLearning

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