{"product_id":"essays-in-derivatives-isbn-9780470086254","title":"Essays in Derivatives","description":"In the updated second edition of Don Chance’s well-received \u003ci\u003eEssays in Derivatives,\u003c\/i\u003e the author once again keeps derivatives simple enough for the beginner, but offers enough in-depth information to satisfy even the most experienced investor. This book provides up-to-date and detailed coverage of various financial products related to derivatives and contains completely new chapters covering subjects that include why derivatives are used, forward and futures pricing, operational risk, and best practices. \u003cp\u003ePreface to the New Edition xiii\u003c\/p\u003e \u003cp\u003ePreface to the First Edition xv\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION ONE Derivatives and Their Markets 1\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 1 The Structure of Derivative Markets 3\u003c\/p\u003e \u003cp\u003eESSAY 2 A Brief History of Derivatives 7\u003c\/p\u003e \u003cp\u003eESSAY 3 Why Derivatives? 15\u003c\/p\u003e \u003cp\u003eESSAY 4 Forward Contracts and Futures Contracts 25\u003c\/p\u003e \u003cp\u003eESSAY 5 Options 29\u003c\/p\u003e \u003cp\u003eESSAY 6 Swaps 33\u003c\/p\u003e \u003cp\u003eESSAY 7 Types of Risks 37\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION TWO The Basic Instruments 41\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 8 Interest Rate Derivatives: FRAs and Options 43\u003c\/p\u003e \u003cp\u003eESSAY 9 Interest Rate Derivatives: Swaps 49\u003c\/p\u003e \u003cp\u003eESSAY 10 Currency Swaps 53\u003c\/p\u003e \u003cp\u003eESSAY 11 Structured Notes 57\u003c\/p\u003e \u003cp\u003eESSAY 12 Securitized Instruments 61\u003c\/p\u003e \u003cp\u003eESSAY 13 Equity Swaps 67\u003c\/p\u003e \u003cp\u003eESSAY 14 Equity-Linked Debt 71\u003c\/p\u003e \u003cp\u003eESSAY 15 Commodity Swaps 75\u003c\/p\u003e \u003cp\u003eESSAY 16 American versus European Options 79\u003c\/p\u003e \u003cp\u003eESSAY 17 Swaptions 83\u003c\/p\u003e \u003cp\u003eESSAY 18 Credit Derivatives 89\u003c\/p\u003e \u003cp\u003eESSAY 19 Volatility Derivatives 95\u003c\/p\u003e \u003cp\u003eESSAY 20 Weather and Environmental Derivatives 99\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION THREE Derivative Pricing 103\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 21 Forward and Futures Pricing 105\u003c\/p\u003e \u003cp\u003eESSAY 22 Put-Call Parity for European Options on Assets 111\u003c\/p\u003e \u003cp\u003eESSAY 23 Put-Call Parity for American Options on Assets 115\u003c\/p\u003e \u003cp\u003eESSAY 24 Call Options as Insurance and Margin 119\u003c\/p\u003e \u003cp\u003eESSAY 25 A Nontechnical Introduction to Brownian Motion 123\u003c\/p\u003e \u003cp\u003eESSAY 26 Building a Model of Brownian Motion in the Stock Market 129\u003c\/p\u003e \u003cp\u003eESSAY 27 Option Pricing: The Black-Scholes-Merton Model 133\u003c\/p\u003e \u003cp\u003eESSAY 28 Option Pricing: The Binomial Model 139\u003c\/p\u003e \u003cp\u003eESSAY 29 Option Pricing: Numerical Methods 143\u003c\/p\u003e \u003cp\u003eESSAY 30 Dynamic Option Replication 147\u003c\/p\u003e \u003cp\u003eESSAY 31 Risk-Neutral Pricing of Derivatives: I 153\u003c\/p\u003e \u003cp\u003eESSAY 32 Risk-Neutral Pricing of Derivatives: II 159\u003c\/p\u003e \u003cp\u003eESSAY 33 It’s All Greek to Me 165\u003c\/p\u003e \u003cp\u003eESSAY 34 Implied Volatility 169\u003c\/p\u003e \u003cp\u003eESSAY 35 American Call Option Pricing 175\u003c\/p\u003e \u003cp\u003eESSAY 36 American Put Option Pricing 181\u003c\/p\u003e \u003cp\u003eESSAY 37 Swap Pricing 185\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION FOUR Derivative Strategies 191\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 38 Asset Allocation with Derivatives 193\u003c\/p\u003e \u003cp\u003eESSAY 39 Protective Puts and Portfolio Insurance 197\u003c\/p\u003e \u003cp\u003eESSAY 40 Misconceptions about Covered Call Writing 201\u003c\/p\u003e \u003cp\u003eESSAY 41 Hedge Funds and Other Privately Managed Accounts 205\u003c\/p\u003e \u003cp\u003eESSAY 42 Spreads, Collars, and Prepaid Forwards 209\u003c\/p\u003e \u003cp\u003eESSAY 43 Box Spreads 213\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION FIVE Exotic Instruments 217\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 44 Barrier Options 219\u003c\/p\u003e \u003cp\u003eESSAY 45 Straddles and Chooser Options 223\u003c\/p\u003e \u003cp\u003eESSAY 46 Compound and Installment Options 227\u003c\/p\u003e \u003cp\u003eESSAY 47 Digital Options 231\u003c\/p\u003e \u003cp\u003eESSAY 48 Geographic Options 235\u003c\/p\u003e \u003cp\u003eESSAY 49 Multi-Asset Options 239\u003c\/p\u003e \u003cp\u003eESSAY 50 Range Forwards and Break Forwards 243\u003c\/p\u003e \u003cp\u003eESSAY 51 Lookback Options 249\u003c\/p\u003e \u003cp\u003eESSAY 52 Deferred Start and Contingent Premium Options 253\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION SIX Fixed Income Securities and Derivatives 257\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 53 Duration 259\u003c\/p\u003e \u003cp\u003eESSAY 54 Limitations of Duration and the Concept of Convexity 263\u003c\/p\u003e \u003cp\u003eESSAY 55 The Term Structure of Interest Rates 269\u003c\/p\u003e \u003cp\u003eESSAY 56 Theories of the Term Structure: I 273\u003c\/p\u003e \u003cp\u003eESSAY 57 Theories of the Term Structure: II 279\u003c\/p\u003e \u003cp\u003eESSAY 58 Simple Models of the Term Structure: Vasicek and Cox-Ingersoll-Ross 285\u003c\/p\u003e \u003cp\u003eESSAY 59 No-Arbitrage Models of the Term Structure: Ho-Lee and Heath-Jarrow-Morton 291\u003c\/p\u003e \u003cp\u003eESSAY 60 Tree Pricing of Bonds and Interest Rate Derivatives: I 297\u003c\/p\u003e \u003cp\u003eESSAY 61 Tree Pricing of Bonds and Interest Rate Derivatives: II 301\u003c\/p\u003e \u003cp\u003eESSAY 62 Tree Pricing of Bonds and Interest Rate Derivatives: III 307\u003c\/p\u003e \u003cp\u003eESSAY 63 Tree Pricing of Bonds and Interest Rate Derivatives: IV 313\u003c\/p\u003e \u003cp\u003eESSAY 64 Tree Pricing of Bonds and Interest Rate Derivatives: V 319\u003c\/p\u003e \u003cp\u003e\u003cb\u003eSECTION SEVEN Other Topics and Issues 325\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eESSAY 65 Stock Options 327\u003c\/p\u003e \u003cp\u003eESSAY 66 Value at Risk 335\u003c\/p\u003e \u003cp\u003eESSAY 67 Stock as an Option 341\u003c\/p\u003e \u003cp\u003eESSAY 68 The Credit Risk of Derivatives 345\u003c\/p\u003e \u003cp\u003eESSAY 69 Operational Risk 349\u003c\/p\u003e \u003cp\u003eESSAY 70 Risk Management in an Organization 355\u003c\/p\u003e \u003cp\u003eESSAY 71 Accounting and Disclosure of Derivatives 361\u003c\/p\u003e \u003cp\u003eESSAY 72 Worst Practices in Derivatives 367\u003c\/p\u003e \u003cp\u003eESSAY 73 Best Practices in Derivatives 375\u003c\/p\u003e \u003cp\u003eRecommended Reading 379\u003c\/p\u003e \u003cp\u003eAnswers to End-of-Essay Questions 381\u003c\/p\u003e   \u003cp\u003e\u003cb\u003eDON M. CHANCE\u003c\/b\u003e holds the William H. Wright Jr. Endowed Chair for Financial Services at the E. J. Ourso College of Business Administration at Louisiana State University. He was formerly the First Union Professor of Financial Risk Management at the Pamplin College of Business at Virginia Tech. Prior to his academic career, Chance worked for a large southeastern bank. Professor Chance has had numerous articles published in academic and practitioner journals, is often quoted in the media, and has an extensive consulting practice. He holds a PhD in finance from LSU and is a CFA charterholder.    \u003c\/p\u003e\u003cp\u003e\u003cb\u003eESSAYS IN DERIVATIVES\u003c\/b\u003e \u003c\/p\u003e\u003cp\u003eSECOND EDITION \u003c\/p\u003e\u003cp\u003eDerivatives can be a painfully difficult subject to master, usually requiring a steep learning curve. As Don Chance points out, \"many legal pads are used up, sometimes frustratingly, in working through some of the principles covered in technical derivatives books.\" This book is different. In the updated second edition of Chance's well-received \u003ci\u003eEssays in Derivatives\u003c\/i\u003e, the author once again keeps derivatives simple enough for the beginner, but offers enough in-depth information to satisfy the more experienced investor. \u003c\/p\u003e\u003cp\u003eThis book provides up-to-date and detailed coverage of various financial products related to derivatives in several key areas: derivatives and their markets, the basic instruments, derivative pricing, derivative strategies, exotic instruments, and fixed income securities and derivatives. Chance begins with the basics, defining what a derivative is, outlining four common types—forward contracts, futures contracts, options, and swaps—and explaining the kinds of situations in which one type might be used and preferred over another. From there, he gradually moves on to more complex topics—all presented in the same accessible, down-to-earth style and nontechnical language. \u003c\/p\u003e\u003cp\u003eSince the first edition of this book was published in 1998, the derivatives business has become vastly more sophisticated. Recognizing this, the author has eliminated outdated material and, in addition to revising almost every chapter in the book, has added many completely new chapters, covering subjects that include why derivatives are used, forward and futures pricing, operational risk, volatility derivatives, weather derivatives, good and bad practices, and other new topics. In addition, the end of each chapter includes practice questions that allow you to test how much of the material has been retained. Answers are provided at the end of the book. \u003c\/p\u003e\u003cp\u003eThe material in \u003ci\u003eEssays in Derivatives\u003c\/i\u003e will appeal to individuals at all levels of expertise. Beginners will find these essays particularly useful in gaining a fundamental grasp of the subject, and experts will appreciate the simple manner in which such seemingly complicated subjects can be presented. Both will agree: a basic understanding of derivatives need not be hard . . . and can even be enjoyable.\u003c\/p\u003e","brand":"Wiley","offers":[{"title":"Default Title","offer_id":47989154611429,"sku":"NP9780470086254","price":55.0,"currency_code":"USD","in_stock":false}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/1842\/7735\/files\/9780470086254.jpg?v=1761783018","url":"https:\/\/k12savings.com\/products\/essays-in-derivatives-isbn-9780470086254","provider":"K12savings","version":"1.0","type":"link"}