Derivatives Markets 3rd Edition, by Robert L. McDonald, pdf, ebook, download presents the sometimes challenging world of futures, options, and other derivatives in an accessible, cohesive, and intuitive manner. Some features of the book include insights into pricing models. Formulas are motivated and explained intuitively.
To be financially literate in today’s market, business students must have a solid understanding of derivatives concepts and instruments and the uses of those instruments in corporations. The book has an accessible mathematical presentation, and more importantly, helps students 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.
Links between the various derivative instruments are highlighted. Students learn how derivatives markets work, with an emphasis on the role of competitive market-makers in determining prices. This book also offers tiered approach to mathematics. Most of the book assumes only basic mathematics, such as solving two equations in two unknowns.
The last quarter of the book uses calculus, and provides an introduction to the concepts and pricing techniques that are widely used in derivatives today. Chapters on corporate applications, financial engineering, and real options illustrate the broad applicability of the tools and models developed in the book. A rich array of examples bolsters the theory.
This book offers computation-friendly approach. The options pricing functions used in the text are available in accompanying Excel spreadsheets. Visual Basic code for the pricing functions is included, and can be modified for your own use.
Table of Contents
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
App. A The Greek Alphabet
App. B Continuous Compounding
App. C Jensen’s Inequality
App. D An Introduction to Visual Basic for Applications
ASIN : B00SLSEPT0
Publisher : Pearson (July 23, 2013)
Best Sellers Rank: #1,876,082 in Books (See Top 100 in Books)
Customer Reviews: 4.1 out of 5 stars 39 ratings
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