Description

Foreign Exchange Market and Derivatives

F.Y.B.Com. (Management Studies) – Semester II

As Per NEP 2020 (w.e.f. the Academic Year 2024-25)

Syllabus

Module 1 :
Unit 1 : Foreign Exchange Markets – An Overview
(a) Concept, Features, Need, Participants, Functions, Structure of Forex Markets, Foreign Currency Accounts – VOSTRO, NOSTRO, LORO, Meaning and Types of Foreign Exchange Risk, Role of Foreign Exchange Dealers Association of India.
(b) FERA and FEMA Regulations, Advantages – Limitations of Capital and Current Account Convertibility, Meaning – Advantages -Limitations of Fixed and Flexible Exchange Rate, Distinction Between Fixed and Flexible Exchange Rate.

Module 2 :
Unit 2 : Derivatives Market
(a) Definition of Derivatives, Features, Benefits of Derivatives, Disadvantages of Derivatives, Introductions and Significance of Index, Types of Foreign Exchange Quotations, Basic Numerical Problems – Direct and Indirect Quotes, Spread, Spread Percentage, Forward Rates, Cross Rate.
(b) Emerging Structure of Derivatives Markets in India – Types of Derivatives and Practical Numerical Problems on Spot, Forward, Futures, Options and Swap.