Introduction to Derivative Financial Instruments

[back cover copy] Information, Tools, and Techniques to Understand and Capitalize on Derivative Financial Products If you want to take advantage of powerful financial instruments, McGraw-Hill's comprehensive new sourcebook on derivatives will help you acquire the solid foundation of knowledge you need.Introduction to Derivative Financial Instrumentsequips bankers, traders and institutional investors with the understanding and appreciation of the full range of basic derivatives products: From options, futures, forwards, and swaps to interest rate risk, foreign exchange risk and much more. This is a vital wealth-building reference for all financial professionals, offering a comprehensive toolkit for capitalizing on the potential of derivative products in today's global marketplace, without losing your fortune. Written by renowned financial advisor and author Dimitris Chorafas, the book explores the nature of derivatives, including their strategic uses, problems associated to liquidity and solvency, and the role of derivatives in hedging. Packed with proven methods and case studies for making derivatives an integral part of the portfolio management process, with effective risk controlIntroduction to Derivative Financial Instrumentsfeatures: A solid foundation in fundamental derivative products Expert guidance on all basic types of derivatives Advice on how derivatives risk can be controlled Information on instruments that escape prudential risk management, A wide range of case studies with successful and unsuccessful investments in derivatives [Flap Copy] Although derivatives are complex financial instruments, internationally known derivative expert Dimitris Chorafas explains them in the simplest possible terms. Simplicity is important because, depending on how they are used derivatives can be friend or foe. The difference lies on how professionals design them, price them, sell them, and manage exposure to risk. Filled with sound advice, proven methods, and detailed case studies,Introduction to Derivative Financial Instrumentsalso covers: Financial Innovation - analyzing the evolving field of service science Strategic Uses - including balance sheet creativity and associated risk Tactical Uses - examining ways of employing derivatives to promote strategic objectives Option Traders, Buyers and Writers - introducing readers to the notion of right pricing of these instruments Futures and Forwards - showing what they offer to investors, as well as what distinguishes futures from forwards Swaps - examining swaps, swaptions, credit default swaps, and other swaps flavors Credit Risk and Market Risk with Options - explaining how to avoid inordinate exposure through smart options management Hedging - outlining the best hedging types and practices, rules for hedge accounting, and the meaning of right and wrong hedges Liquidity, Solvency and Derivatives Exposure - showing how in a panic illiquidity can morph into insolvency The Daunting Task of Capital Adequacy - discussing steps for maintaining a capital base adequate for assumed exposure Comprehensive and up-to-date,Introduction to Derivative Financial Instrumentsprovides a solid account of all basic types and uses of derivatives, describing the many market opportunities they offer, how they fit into portfolio management process, and why risk should be kept under lock and key.Chorafas, Dimitris N. is the author of 'Introduction to Derivative Financial Instruments' with ISBN 9780071546638 and ISBN 0071546634.