Financial Derivatives: Pricing and Risk Management - Hardcover

by Rob Quail (Editor), James A. Overdahl (Editor)

Essential insights on the various aspects of financial derivatives

If you want to understand derivatives without getting bogged down by the mathematics surrounding their pricing and valuation, Financial Derivatives is the book for you. Through in-depth insights gleaned from years of financial experience, Robert Kolb and James Overdahl clearly explain what derivatives are and how you can prudently use them within the context of your underlying business activities.

Financial Derivatives introduces you to the wide range of markets for financial derivatives. This invaluable guide offers a broad overview of the different types of derivatives-futures, options, swaps, and structured products-while focusing on the principles that determine market prices. This comprehensive resource also provides a thorough introduction to financial derivatives and their importance to risk management in a corporate setting. Filled with helpful tables and charts, Financial Derivatives offers a wealth of knowledge on futures, options, swaps, financial engineering, and structured products.

• Discusses what derivatives are and how you can prudently implement them within the context of your underlying business activities
• Provides thorough coverage of financial derivatives and their role in risk management
• Explores financial derivatives without getting bogged down by the mathematics surrounding their pricing and valuation

This informative guide will help you unlock the incredible potential of financial derivatives.

Front Jacket

At a time when our entire financial system is under great stress, many investors point to the misuse of derivatives as one of the primary causes of the financial meltdown. Long misunderstood by the general public, some financial derivatives are fairly simple--while others are quite complicated and require considerable mathematical and statistical knowledge to fully understand. But with our financial system now undergoing unprecedented changes, there has never been a better time to gain a firm understanding of these instruments.

As part of the Robert W. Kolb Series in Finance, Financial Derivatives skillfully explores the contemporary world of financial derivatives. Starting with a presumption of only a general knowledge of undergraduate finance, this collection of essential perspectives, written by leading figures in academics, industry, and government, provides a comprehensive understanding of financial derivatives. The contributors provide a complete overview of the types of financial derivatives and the markets in which they trade. They analyze the development and current state of derivatives markets--including their regulation--and examine the role of derivatives in risk management. They look at the pricing of derivatives, beginning with the fundamentals and move on to more advanced pricing techniques, showing how Monte Carlo methods can be applied to price derivatives.

The book concludes with an examination of the many ways derivatives can be used. While it is clear that financial derivatives are valuable for managing risks and for providing information about the future prices of underlying goods, they can also be used as very sophisticated speculation tools. The authors explore option strategies used to

speculate and show how the same strategies can be employed to reduce risk. In addition, they reveal how financial derivatives can effectively manage interest rate risk and discuss how hedge funds use financial derivatives.

Uncertainty is a hallmark of today's global financial marketplace. This essential guide to financial derivatives will help you unlock their vast potential for risk management and much, much more.

Back Jacket

PRAISE FOR FINANCIAL DERIVATIVES

The Robert W. Kolb Series in Finance is an unparalleled source of information dedicated to the most important issues in modern finance. Each book focuses on a specific topic in the field of finance, and contains contributed chapters from both respected academics and experienced financial professionals. As part of the Robert W. Kolb Series in Finance, Financial Derivatives aims to provide a comprehensive understanding of financial derivatives and how you can prudently use them within the context of your underlying business activities.

For the public at large, financial derivatives have long been the most mysterious and least understood of all financial instruments. Through in-depth insights gleaned from years of financial experience, the contributors in this collection clearly explain what derivatives are without getting bogged down by the mathematics surrounding their pricing and valuation.

Financial Derivatives offers a broad overview of the different types of derivatives--futures, options, swaps, and structured products--while focusing on the principles that determine market prices. This comprehensive resource also provides a thorough introduction to financial derivatives and their importance to risk management in a corporate setting. Filled with in-depth analysis and examples, Financial Derivatives offers readers a wealth of knowledge on futures, options, swaps, financial engineering, and structured products.

Author Biography

Robert W. Kolb (Chicago, IL) is the Frank W. Considine Chair of Applied Ethics and Professor of Finance at Loyola University Chicago. Before this, he was the Assistant Dean, Business and Society, and Director, Center for Business and Society, at the University of Colorado at Boulder, and department chairman at the University of Miami. Kolb is also the author of over twenty books on finance, derivatives, and futures, and has authored numerous articles in leading finance journals.

James A. Overdhal (Washington, DC) a specialist in financial derivatives, is the Chief Economist of the United States Securities and Exchange Commission. He had previously served as chief economist of the Commodity Futures Trading Commission and has nearly two decades of experience in senior positions at various federal financial regulatory agencies. He has taught economics and finance at the University of Texas at Dallas, Georgetown University, Johns Hopkins University, and George Washington University. Overdahl earned his PhD in economics from Iowa State University.