INTRO DERIV SECUR, FIN (3RD ED)The third edition updates the text in two significant ways. First, it updates the presentation to reflect changes that have occurred in financial markets since the publication of the 2nd edition. One such change is with respect to the over-the-counter interest rate derivatives markets and the abolishment of LIBOR as a reference rate. Second, it updates the theory to reflect new research related to asset price bubbles and the valuation of options. Asset price bubbles are a reality in financial markets and their impact on derivative pricing is essential to understand. This is the only introductory textbook that contains these insights on asset price bubbles and options.Contents: About the AuthorsPreface to Second EditionPreface to First EditionIntroduction:Derivatives and Risk ManagementInterest RatesStocksForwards and FuturesOptionsArbitrage and TradingFinancial Engineering and SwapsForwards and Futures:Forwards and Futures MarketsFutures TradingFutures RegulationsThe Cost-of-Carry ModelThe Extended Cost-of-Carry ModelFutures HedgingOptions:Options Markets and TradingOption Trading StrategiesOption RelationsSingle-Period Binomial ModelMultiperiod Binomial ModelThe Black’Scholes’Merton ModelUsing the Black’Scholes’Merton ModelInterest Rate Derivatives:Yields and Forward RatesInterest Rate SwapsSingle-Period Binomial Health’Jarrow’Morton ModelMultiperiod Binomial HJM ModelThe Health’Jarrow’Morton Libor ModelRisk Management ModelsAppendix AMathematics and StatisticsGlossaryReferencesNotationAdditional Sources and WebsitesBooks on Derivatives and Risk ManagementName-IndexSubject-IndexReadership: Undergraduate and graduate students of economics, business, arts, science and engineering, and MBAs who would work in the finance industry.Reviews of the Second Edition:’The text is pleasantly different from others in the market, especially the clarity of the explanations provided for the concepts involved. The teaching slides provided are the best I have encountered to-date.’ – Dr Nagaratnam JeyasreedharanUniversity of Tasmania, Australia ‘I have read the whole book and I find it excellent. It’s a great blend of theory and the ‘institutional’ aspects of derivatives trading.’ – Professor Rafael de SantiagoIESE Business School, Spain ‘This book is a great resource for a rigorous introduction to derivatives, both pricing and markets. Thanks to an elaborate set of detailed examples, references to relevant case studies, a full set of worked solutions to problem sets and slides, using this book means reduced prep time without sacrificing the students’ learning experience.’ – Dr Thijs van der HeijdenUniversity of Melbourne, Australia ‘My understanding of derivatives has been purely mathematical, so it’s great to learn about all the historical developments, the background material, and all the interesting anecdotes the authors have included.’ – Professor Kevin AretzUniversity of Manchester, UK ‘This book’s interest rate derivatives chapters are some of the best chapters I have read, because the authors have provided an outstanding and distinctive work in teaching the basics, examples, and practical applications of interest rate derivatives and the Heath-Jarrow-Morton (HJM) model.’ – Professor Scott FungCalifornia State University, East Bay, USA ISBN: 9789811291647, 9811291640
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