This book gives a self-contained, intuitive overview of some of the most important topics of finance, such as investment risk, market pricing and market efficiency, arbitrage, hedging, and the pricing and application of financial derivatives. It provides a first-principles introduction to the relevant material and concepts, emphasising intuition. Financial terminology, and the understanding implicit therein, is carefully introduced. The books starts with finance in the most general terms, and gradually specialises to investment theory and then derivatives. This book is tailor-made for readers new to finance, such as graduate students entering or interested in finance, or financial practitioners moving to a more quantitative role.
Author(s): Alex Backwell
Series: Springer Texts in Business and Economics
Publisher: Springer
Year: 2023
Language: English
Pages: 90
City: Cham
Preface
Contents
1 Preliminaries
1.1 What Is Finance?
1.2 Returns and Interest Rates
Literature Notes
References
2 Risk and Expected Utility
2.1 Risk Measures
2.2 Utility and the Expected Utility Hypothesis
Literature Notes
References
3 Market Pricing and Market Efficiency
3.1 The Efficient-Market Hypothesis
3.2 Implications
Literature Notes
References
4 Modern Portfolio Theory
Literature Notes
References
5 Asset Pricing
5.1 The CAPM
5.2 Factor Models
Literature Notes
References
6 Introduction to Derivatives
6.1 Forward Contracts
6.2 Options
Literature Notes
References
7 Arbitrage- and Model-Free Pricing Methods
7.1 Arbitrage
7.2 Pricing and Hedging Forwards
7.3 Model-Free Option Analysis
Literature Notes
References
8 Modelling, Pricing, and Hedging
8.1 The One-Period Binomial Model
8.2 The Black–Scholes–Merton Model
8.3 Beyond Black–Scholes–Merton
Literature Notes
References
