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Mastering Financial Calculations: A step-by-step guide to the mathematics of financial market instruments, 3rd Edition

By Bob Steiner

Published by FT Press

Published Date: Feb 23, 2012


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


Part 1

The Basics

Chapter 1:     Financial Arithmetic Basics

Part 2

Interest Rate Instruments

Chapter 2:  The Money Market

Chapter 3:     Forward-Forwards and Forward Rate Agreements

Chapter 4:     Interest Rate Structures

Chapter 5:     Bond Market Calculations

Chapter 6:     Repos, But/Sell-backs and Securities Lending

Chapter 7:     Zero-Coupon Rates and Yield Curves

Part 3

Foreign Exchange

Chapter 8:     Foreign Exchange

Part 4

Swaps and Options

Chapter 9:     Interest Rate and Currency Swaps

Chapter 10:   Options

Part 5

Gold and other commodities

Chapter 11:   Gold and other commodities


Part 6 

Hints and Answers to Exercises

Chapter 12:   Hints and Answers to Exercises