Phase III: Capstone

Session Description

Derivatives: Regulatory Issues

Through lecture and real-world examples, Professor Ramaswamy provides a deep dive into the world of derivatives and related regulatory issues. Participants attending this session gain a better understanding of:

• Exchange-traded derivatives and causes for innovation and growth
• Differences between forward, futures and options contracts
• Hedging margins, net margins and leverage
• Insurance in the form of put options
• Swaps, including credit default swaps and securitization
• Transformation of risks with derivatives
• Ratings, market structure and risk management

 

After completing this session, you will be able to:

• Discuss credit default swaps and securitization issues and their impact upon the current economic crisis
• Compare the different types of derivative products
• Elaborate on regulatory requirements concerning disclosure, documentation and margining of derivatives, particularly swaps
• Understand the subprime market and related frictions, including credit rating agency, asset manager, investor, mortgagor, etc.
• Identify failures of self regulation in the derivatives market

 

Instructor:
Krishna Ramaswamy, Edward Hopkinson, Jr. Professor of Investment Banking and Professor of Finance, University of Pennsylvania