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CFA Level 1 Derivatives

Master the language of derivatives — forwards, futures, swaps, options, and binomial pricing — built for CFA Level 1 candidates who want clarity, not confusion.

👤 Krawl Edutech🌐 English📚 10 sections
CFA Level 1 Derivatives
$44

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About this course

CFA Level 1 Derivatives

Who This Course Is For

This CFA Level 1 course is designed for aspiring CFA charterholders, finance professionals, and quantitatively minded investment practitioners who want a confident, working command of the Derivatives topic area as tested in the CFA Level 1 examination.

Derivatives is one of the most intellectually rewarding — and most feared — subjects in the CFA curriculum. Concepts like arbitrage pricing, forward valuation, options pricing, and binomial models can feel abstract and intimidating when encountered for the first time. This course dismantles that intimidation systematically, building your understanding from first principles through to the precise, calculation-ready fluency the exam demands.

If you have ever looked at a derivatives question and felt uncertain where to begin, this course is built for you.


How This Course Is Delivered

All lessons are pre-recorded and available on demand, so you study at your own pace without compromise. Each topic is built around three pillars:

  • Video lessons that build genuine understanding of every concept from the ground up
  • Worked problem-solving sessions that mirror actual CFA exam questions with full step-by-step solutions
  • Concise revision notes you can return to at any time — especially in the final weeks before your exam

Everything is structured to move you from first encounter to exam-ready confidence. The course is delivered entirely in English and follows the official 2025 CFA Level 1 curriculum, covering all readings within the Derivatives topic area — from derivative instrument features and market structure through forward contracts, futures, swaps, options, put-call parity, and binomial model valuation.

What you will learn

✓Complete coverage of the entire CFA Level 1 Derivatives syllabus — every reading, every learning outcome, nothing skipped
✓Enough practice problems with fully guided, step-by-step solutions so you genuinely understand the reasoning — not just the answer
✓What derivatives are, how derivative markets are structured, and the key distinctions between over-the-counter and exchange-traded markets
✓The full landscape of derivative instruments — forward contracts, futures, swaps, options (calls and puts), and credit derivatives — and how each one works, is priced, and is used
✓How to determine the value and profit from long and short positions in call and put options at expiration — a skill tested directly and repeatedly in the CFA exam
✓The core principles of arbitrage and replication, and how they underpin the pricing of every derivative instrument you will encounter
✓How forward contracts are valued at initiation, during their life, and at expiration — and how forward rates are determined for interest rate forwards
✓The relationship between forward and futures contracts, why their prices can differ, and how swap contracts relate to a series of forward commitments
✓How to price and value options using the one-period binomial model, and the concept of risk neutrality that makes derivatives pricing internally consistent

Key points / Requirements

  • ●No prior derivatives experience required — the course builds from first principles and assumes only basic financial literacy and familiarity with the time value of money
  • ●Aligned to the official CFA Level 1 Topic Outline — every learning outcome is covered without gaps
  • ●Pre-recorded lessons allow you to study on your schedule — pause, rewind, and revisit any concept as many times as needed
  • ●Each module combines conceptual teaching, worked exam-style problems, and revision notes for a complete study loop
  • ●Covers all readings within Derivatives: Instrument & Market Features, Forward Commitments & Contingent Claims, Derivative Benefits & Risks, Arbitrage & Replication, Forward & Futures Pricing, Swap Pricing, Options Pricing, Put-Call Parity, and the Binomial Model
  • ●A basic financial calculator (BA II Plus recommended) is sufficient for all numerical problems in this course — no specialist software required
  • ●Revision notes are structured for active recall — ideal for the final weeks before your exam window
  • ●Suitable for all three CFA exam windows — content is evergreen and mapped to the current curriculum
  • ●Best results when studied after or alongside Krawl's Quantitative Methods and Fixed Income courses — Derivatives builds directly on time value of money and interest rate concepts

Course content

10 sections · 27 lectures

Section 1: Derivative Instrument & Derivative Market Features

3 lectures
  • ▸ Foundations: What a Derivative Is — Definition & Defining Features
  • ▸ Derivative Underlyings & Investor Scenarios
  • ▸ Derivative Markets: OTC, Exchange-Traded & Central Clearing

Section 2: Forward Commitment & Contingent Claim Features and Instruments

4 lectures
  • ▸ Forward Commitments I: Forwards
  • ▸ Forward Commitments II: Futures & Swaps
  • ▸ Contingent Claims: Options & Payoff Scenarios (Sₜ>X, Sₜ<X)
  • ▸ Credit Derivatives & Forward Commitments vs. Contingent Claims

Section 3: Derivative Benefits, Risks, and Issuer & Investor Uses

3 lectures
  • ▸ Derivative Benefits
  • ▸ Derivative Risks
  • ▸ Issuer & Investor Uses of Derivatives

Section 4: Arbitrage, Replication, and the Cost of Carry in Pricing Derivatives

3 lectures
  • ▸ Arbitrage & the Law of One Price
  • ▸ Replication: Building Synthetic Positions
  • ▸ Cost of Carry: Costs & Benefits of Owning the Underlying

Section 5: Pricing & Valuation of Forward Contracts

2 lectures
  • ▸ Pricing and Valuation of Forward Contracts
  • ▸ Pricing and Valuation of Interest Rate Forward Contracts

Section 6: Pricing & Valuation of Futures Contracts

2 lectures
  • ▸ Futures Pricing at Inception & MTM Valuation (Forwards vs. Futures)
  • ▸ Forwards vs. Futures: Convexity, Price Differences & Central Clearing

Section 7: Pricing & Valuation of Interest Rate and Other Swaps

2 lectures
  • ▸ Swaps vs. Forwards
  • ▸ Swap Values & Prices

Section 8: Pricing & Valuation of Options

3 lectures
  • ▸ Option Value vs. Spot: Exercise Value, Moneyness & Time Value
  • ▸ Option Arbitrage & Replication
  • ▸ Factors Affecting Option Value

Section 9: Option Replication Using Put–Call Parity

2 lectures
  • ▸ Put–Call Parity
  • ▸ Option Strategies & Put–Call Forward Parity (incl. Firm-Value Applications)

Section 10: Valuing a Derivative Using a One-Period Binomial Model

3 lectures
  • ▸ The One-Period Binomial Model: Setup & the Tree
  • ▸ Pricing a European Call Option on the Tree
  • ▸ Risk Neutrality & Risk-Neutral Probabilities

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