Derivatives Markets Chapters 1-8

[siomai_lover]

I passed Exam FM in 2006 and planning to take Exam MFE this november. Do I need to read chapters of Derivatives Markets that are part of the required readings in Exam FM in able to understand chapters required for Exam MFE?

[colby2152]

I would go over them quickly as an introduction. It's good to understand calls, puts, forwards, and put-call parity before you move on.

[Harold Cherry]

Abe Weishaus' ASM manual for MFE contains a review of the FM/2 material needed for MFE. You can download it for free by visiting the ASM web site www.studymanuals.com. (Click on the link to Excerpts on the MFE page.) You will also find a free practice exam there.

[kamek85]

What a huge waste of time! MFE deals predominantly with options, rendering Chapter 8's discussion of swaps completely irrelevant, and Chapter 5's coverage of forwards and futures dubious at best.

Yes, you need to understand the concept of a prepaid forward for put-call parity. That can be picked up in about two minutes. Focus on MFE-specific material.

[colby2152]

If you have no clue what an option is, then it isn't a huge waste of time. I will agree that the discussion of swaps is completely useless. I'm sure the discussion into all the spreads and collars isn't that useful.

However, reading the first few chapters lays down the groundwork.