Created by the experienced author team of Frank Fabozzi and Pamela Peterson Drake, Financial Risk Management examines the essential elements of this discipline and makes them accessible to a wide array of readers-from seasoned veterans looking for a review to newcomers needing to get their footing in finance.
Financial risk is the exposure of a corporation to an event that can cause a shortfall in a targeted financial measure or value and includes market risk, credit risk, market liquidity risk, operational risk, and legal risk. This material discusses the four key processes in financial risk management: risk identification, risk assessment, risk mitigation, and risk transferring. The process of risk management involves determining which risks to accept, which to neutralize, and which to transfer.
About the Author
Table of ContentsPreface.
About the Authors.
PART ONE: Background.
CHAPTER 1: What Is Finance?
CHAPTER 2: Mathematics of Finance.
CHAPTER 3: Basics of Financial Analysis.
PART TWO: Capital Markets and Capital Market Theory.
CHAPTER 4: The Financial System.
CHAPTER 5: Interest Rate Determination and the Structure of Interest Rates.
CHAPTER 6: Basics of Derivatives.
CHAPTER 7: Asset Valuation: Basic Bond and Stock Valuation Models.
CHAPTER 8: Asset Valuation:The Theory of Asset Pricing.
PART THREE: Financial Management.
CHAPTER 9: Financial Management.
CHAPTER 10: Financial Strategy and Financial Planning.
CHAPTER 11: The Corporate Financing Decision.
CHAPTER 12: Financial Engineering, Asset Securitization, and Project Financing.
CHAPTER 13: Capital Budgeting: Process and Cash Flow Estimation.
CHAPTER 14: Capital Budgeting Techniques.
CHAPTER 15: Managing Current Assets.
CHAPTER 16: Financial Risk Management.
PART FOUR: Investment Management.
CHAPTER 17: The Basic Principles of Investment Management.
CHAPTER 18: Equity Portfolio Management.
CHAPTER 19: Bond Portfolio Management.
CHAPTER 20: Use of Stock Index Futures andTreasury Futures Contracts in Portfolio Management.
CHAPTER 21: Use of Options in Portfolio Management.