Derivatives Demystified - Hardcover

by Andrew M. Chisholm (Author)

Derivatives are everywhere in the modern world and it is important for everyone in banking, investment and finance to have a good understanding of the subject. Derivatives Demystified provides a step-by-step guide to the subject, enabling the reader to have a solid, working understanding of key derivative products.

Adopting a highly accessible approach, the author explains derivative products in straightforward terms and without the complex mathematics that underlie the subject, focusing on practical applications, case studies and examples of how the products are used to solve real-world problems. Derivatives Demystified follows a sequence that is designed to show that, although there are many applications of derivatives, there are only a small number of basic building blocks, namely forwards and futures, swaps and options. The book shows how each building block is applied to different markets and to the solution of various risk management and trading problems.

This new edition will be fully revised to reflect the many changes the derivatives markets have seen over the last three years. New material will include a comprehensive history of derivatives, leading up to their use and abuse in the current credit crisis. It will also feature new chapters on regulation and control of derivatives, commodity derivatives, credit derivatives and structured products and new derivative markets including inflation linked and insurance linked products.

Derivatives Demystified is essential reading for everyone who operates in the financial markets or within the corporate environment who requires a good understanding of these important financial instruments.

Back Jacket

Derivatives are everywhere in the modern world. They are constantly discussed (and sometimes vilified). It is now more important than ever for participants in the banking, investment and finance sectors to fully understand the building blocks, uses and limitations of these important financial products.

Fully revised and updated to take into account the many changes the industry has seen over the last few years, Derivatives Demystified is a step-by-step guide to financial derivatives, enabling the reader to build a solid, working knowledge of key derivative products. It is based on the author's many years of experience teaching the subject to market practitioners, ranging from the most senior managers in the global banking industry to recent MBA and graduate hires. Adopting a highly accessible and structured approach, the author explains derivative products in straightforward terms and without the complex mathematics that underlie the subject. The focus is on practical applications, case studies and examples of how products are used to solve real-world problems. It follows a sequence that is designed to show that, although there are many applications of derivatives, there are only a small number of basic building blocks. The book examines how each building block is applied to different markets and to the solution of various risk management, investment and trading problems.

It features a wealth of updated and new material covering the latest developments in the derivatives markets, including the role of derivative products in the global financial crisis, settlement and risk-management, market regulation, commodity derivatives, credit derivatives, later-generation or 'exotic' options, structured products including collateralized debt obligations (CDOs), and inflation-linked and weather derivatives.

Derivatives Demystified is essential reading for anyone who operates in the financial markets or within the corporate environment requiring a solid understanding of these critical financial instruments.

Author Biography

ANDREW M. CHISHOLM MA MBA PhD is a Visiting Fellow at the International Capital Market Association (ICMA) Centre at the University of Reading in England. He has designed, developed and taught programmes in derivatives and finance for more than 25 years. In that time, he has worked with many of the largest financial institutions around the world, teaching corporate financiers, traders, sales and marketing staff, risk managers, analysts, fund managers, operations and technology professionals. He has worked extensively on seminars at senior management level as well as training programmes designed to introduce new graduate and MBA entrants to the securities industry. He was formerly Head of Professional Development for Europe at JP Morgan and is the author of An Introduction to International Capital Markets, the second edition of which was published by John Wiley and Sons in 2009.