Derivatives Markets

by McDonald, Robert L.

• ISBN13: 9780321543080
• ISBN10: 0321543084
• Edition: 3rd
• Format: Hardcover
• Copyright: 2012-09-06
• Publisher: Pearson

Summary

To be financially literate in today's market, one must have a solid understanding of derivatives concepts and instruments and the uses of those instruments in corporations. The Third Edition has an accessible mathematical presentation, and more importantly, helps readers gain intuition by linking theories and concepts together with an engaging narrative that emphasizes the core economic principles underlying the pricing and uses of derivatives.

Table of Contents

  Preface
  Chapter 1    Introduction to Derivatives
  PART ONE   INSURANCE, HEDGING, AND SIMPLE STRATEGIES
  Chapter 2    An Introduction to Forwards and Options
  Chapter 3    Insurance, Collars, and Other Strategies
  Chapter 4    Introduction to Risk Management
  PART TWO   FORWARDS, FUTURES, AND SWAPS
  Chapter 5    Financial Forwards and Futures
  Chapter 6    Commodity Forwards and Futures
  Chapter 7    Interest Rate Forwards and Futures
  Chapter 8    Swaps
  PART THREE   OPTIONS
  Chapter 9    Parity and Other Option Relationships
  Chapter 10   Binomial Option Pricing: Basic Concepts
  Chapter 11   Binomial Option Pricing: Selected Topics
  Chapter 12   The Black-Scholes Formula
  Chapter 13   Market-Making and Delta-Hedging
  Chapter 14   Exotic Options: I
  PART FOUR   FINANCIAL ENGINEERING AND APPLICATIONS
  Chapter 15   Financial Engineering and Security Design
  Chapter 16   Corporate Applications
  Chapter 17   Real Options
  PART FIVE   ADVANCED PRICING THEORY AND APPLICATIONS
  Chapter 18   The Lognormal Distribution
  Chapter 19   Monte Carlo Valuation
  Chapter 20   Brownian Motion and Ito's Lemma
  Chapter 21   The Black-Scholes-Merton Equation
  Chapter 22   Risk-Neutral and Martingale Pricing
  Chapter 23   Exotic Options: II
  Chapter 24   Volatility
  Chapter 25   Interest Rate and Bond Derivatives
  Chapter 26   Value at Risk
  Chapter 27   Credit Risk

  Appendixes
  App. A     The Greek Alphabet
  App. B     Continuous Compounding
  App. C     Jensen's Inequality
  App. D     An Introduction to Visual Basic for Applications
  Glossary
  References
  Index