Financial derivatives assignment:
Q1: Futures of palm oil is used as a reference, who are the participant of Malaysian palm oil, discuss about the objectives, hedges, speculation, arbitrages… etc
who are they, give an example what is the purpose, must be more focused on Malaysian palm oil.
Q2: Discuss about contango and backwardation
INSTRUCTIONS OF THE WRITING:
Word count 2500 not exceeding
Reference APA
Given example is about palm oil and no other examples
assignment must be type written using font Times New Roman size 12
1.5 spacing, justified alignment
1-inch margin on both sides of each page and properly bound
ASSIGNMENT INSTRUCTION:
Both questions have each its own introduction and conclusion:
Into (basic introduction)
Question 1
Conclusions (basic conclusion)
Introduction (basic introduction)
Question 2
Conclusion (basic conclusion)
References
This assignment is an individual assignment and is worth 30% of your total assessment. Proper referencing and citation should be included and use APA Referencing method. Your assignment must be type written using font Times New Roman size 12, 1.5 spacing, justified alignment, 1-inch margin on both sides of each page and properly bound. The numbers of words should not be less than 2,500 words. Cover page of the assignment must include name, student ID, and subject code.
Article
Futures and forwards contracts are considered of the main derivatives contracts, traded in most global financial markets, in addition to the options and swaps contracts. Futures and forward contract are defined as binding contracts to buy or sell underlying assets either commodities assets or financial assets on future date at a specified price agreed upon at the time of the trade. Futures contracts includes trading stocks, bonds, currency, commodities and index and the contracts follow daily settlement procedure of clearinghouse (Chance, 2004). Futures contracts
are traded only in organized market. Forwards contracts, like futures contracts, include trading stocks, currency and commodities, except that they are traded in the-over-the-counter market rather
Required:
1. Discuss critically the trading participants of the FCPO Futures market in the Malaysian Derivatives Exchange
(50 marks)
2. Also discuss the concepts of Contango and Backwardation by using the FCPO contract.
(50 marks)
(TOTAL: 100 marks)
To attempt this assignment successfully, student need to display a wide range of financial management tools and required to apply knowledge learned throughout the subject. Every question should be assessed critically and rationally. References from books, articles or academic journals are required and marks will be reducing if none of the conditions apply. Any enquiries in relations to the assignment should be put up one week before the submission.
