Enhanced descriptions from Syndetics:

Success in today's sophisticated financial markets depends on a firm understanding of key financial concepts and mathematical techniques. Mastering Financial Calculations explains them in a clear, comprehensive way -- so even if your mathematical background is limited, you'll thoroughly grasp what you need to know.

Mastering Financial Calculations starts by introducing the fundamentals of financial market arithmetic, including the core concepts of discounting, net present value, effective yields, and cash flow analysis. Next, walk step-by-step through the essential calculations and financial techniques behind money markets and futures, zero-coupon analysis, interest rate and currency swaps, bonds, foreign exchange, options, and more. Making use of many worked examples and practical exercises, the book explains challenging concepts such as forward pricing, duration analysis, swap valuation, and option pricing - all with exceptional clarity.

Whether you are a trader, fund manager, corporate treasurer, programmer, accountant, risk manager, or market student, you'll gain the ability to manipulate and apply these techniques with speed and confidence.

Table of contents provided by Syndetics

• Foreword (p. xi)
• Introduction (p. xiii)
• Part 1 The Basics
• 1 Financial Arithmetic Basics (p. 3)
• Some opening remarks on formulas (p. 4)
• Use of an HP calculator (p. 4)
• Simple and compound interest (p. 5)
• Nominal and effective rates (p. 10)
• Future value / present value; time value of money (p. 12)
• Discount factors (p. 15)
• Cashflow analysis, NPV, IRR and time-weighted rate of returns (p. 16)
• Annuities (p. 20)
• Using an HP calculator for cashflow analysis (p. 22)
• Interpolation and extrapolation (p. 27)
• Exercises (p. 29)
• 2 Statistics Basics (p. 33)
• Averages - arithmetic and geometric means, weighted averages, median and mode (p. 34)
• Variance, standard deviation and volatility (p. 38)
• Correlation and covariance (p. 44)
• Histograms, probability density and the normal probability function (p. 47)
• Confidence levels and the normal probability table (p. 50)
• Exercises (p. 53)
• Part 2 Interest Rate Instruments
• 3 The Money Market (p. 57)
• Overview (p. 58)
• Day/year conventions (p. 64)
• Money market instruments (p. 66)
• Money market calculations (p. 71)
• Discount instruments (p. 73)
• CDs paying more than one coupon (p. 76)
• Value dates (p. 79)
• Exercises (p. 80)
• 4 Forward-Forward Interest Rates and Forward Rate Agreements (FRAs) (p. 83)
• Forward-forwards, FRAs and futures (p. 84)
• Applications of FRAs (p. 95)
• Exercises (p. 98)
• 5 Interest Rate Futures (p. 101)
• Overview (p. 102)
• Exchange structure and margins (p. 108)
• Futures compared with FRAs (p. 109)
• Pricing and hedging FRAs with futures (p. 111)
• Trading with interest rate futures (p. 117)
• Exercises (p. 124)
• 6 Bond Market Calculations (p. 127)
• Overview of capital market instruments (p. 128)
• Features and variations (p. 130)
• Introduction to bond pricing (p. 134)
• Different yield measures and price calculations (p. 149)
• A summary of the various approaches to price / yield (p. 160)
• Duration, modified duration and convexity (p. 162)
• Bond futures (p. 169)
• Cash-and-carry arbitrage (p. 177)
• Exercises (p. 184)
• 7 Repos, Buy/Sell-backs and Securities Lending (p. 189)
• Introduction (p. 190)
• Classic repo (p. 192)
• Margin calls (p. 195)
• General collateral (GC) and specials (p. 200)
• Other features (p. 202)
• Buy/Sell-back (p. 209)
• Close-out and repricing (p. 214)
• Securities lending (p. 219)
• Comparison between the different transactions (p. 225)
• Uses of repo and securities lending (p. 225)
• Exercises (p. 230)
• 8 Zero-coupon Rates and Yield Curves (p. 235)
• Zero-coupon yields, par yields and bootstrapping (p. 236)
• Forward-forward yields (p. 241)
• Summary (p. 242)
• Longer-dated FRAs (p. 244)
• Exercises (p. 245)
• Part 3 Foreign Exchange
• 9 Foreign Exchange (p. 249)
• Introduction (p. 250)
• Spot exchange rates (p. 250)
• Forward exchange rates (p. 256)
• Cross-rate forwards (p. 269)
• Short dates (p. 270)
• Calculation summary (p. 273)
• Value dates (p. 274)
• Forward-forwards (p. 275)
• Non-deliverable forwards (NDFs) (p. 277)
• Time options (p. 278)
• Long-dated forwards (p. 279)
• Arbitraging and creating FRAs (p. 280)
• Discounting future foreign exchange risk (p. 283)
• Exercises (p. 286)
• Part 4 Swaps and Options
• 10 Interest Rate and Currency Swaps (p. 293)
• Basic concepts and applications (p. 294)
• Overnight index swap (OIS) (p. 298)
• Pricing (p. 302)
• Valuing swaps (p. 310)
• Hedging an interest rate swap (p. 316)
• Amortising and forward-start swaps (p. 317)
• Currency swaps (p. 319)
• Exercises (p. 323)
• 11 Options (p. 326)
• Overview (p. 328)
• The ideas behind option pricing (p. 330)
• Pricing models (p. 332)
• OTC options vs. exchange-traded options (p. 332)
• Value dates for FX options (p. 343)
• Trading with calls and puts (p. 343)
• More trading strategies (p. 349)
• Hedging with options (p. 358)
• Some "packaged" options (p. 359)
• The Greek letters (p. 362)
• Some exotic options (p. 374)
• Credit derivatives, synthetic CDOs and first-to-default baskets (p. 378)
• Exercises (p. 384)
• Part 5 Equities
• 12 Equities (p. 389)
• Introduction (p. 390)
• Ratios (p. 393)
• Valuation (p. 398)
• Stock splits and rights issues (p. 403)
• Stock indices (p. 405)
• Single stock futures (p. 408)
• Stock index futures (p. 410)
• Exercises (p. 411)
• Part 6 Gold and Other Commodities
• 13 Gold and Other Commodities (p. 415)
• Gold (p. 416)
• Gold borrowing, forwards, swaps and GOFO (p. 418)
• Other commodities (p. 424)
• Forward pricing and convenience yield (p. 425)
• Commodity futures and EFP (Exchange For Physical) (p. 429)
• FRAs, swaps and options (p. 434)
• Exercises (p. 436)
• Part 7 Hints and Answers to Exercises
• 14 Hints and Answers to Exercises (p. 441)
• Hints on exercises (p. 442)
• Answers to exercises (p. 459)
• Appendix 1 Using an HP calculator (p. 513)
• Appendix 2 A summary of market day/year conventions and government bond markets (p. 522)
• Appendix 3 A summary of calculation procedures (p. 525)
• Appendix 4 Glossary (p. 547)
• Appendix 5 ISO (SWIFT) currency codes (p. 578)
• Select Bibliography (p. 585)
• Index (p. 587)

Author notes provided by Syndetics

Bob Steiner is the founder/managing director of Markets International, an independent training company. A former treasury officer and financial consultant he's also the author of Key Financial Market Concepts , now in its second edition.