Mastering Financial

A practical guide for business calculations http://www.dropshippers.co.za/

Mastering Financial Mathematics in Microsoft © Excel provides a comprehensive set of tools, methods and formulas which apply Excel to solving mathematical problems. http://www.dropshippers.co.za/

The book: http://www.dropshippers.co.za/

• Explains basic calculations for mathematical finance
• Shows how to use formulas using straightforward Excel templates
• Provides a CD of basic templates
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This fully revised and updated guide is an essential companion for anyone involved in finance, from company accountants, through to analysts, treasury managers and business students. Explaining basic calculations and using examples and exercises, the book covers: http://www.dropshippers.co.za/

• Cash flows
• Bonds calculations and bonds risks
• Amortization and depreciation
• Forward interest rates and futures
• Foreign exchange
• Valuation
• Leasing
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Mastering Financial Mathematics in Microsoft Excel is a practical guide to using Excel for financial mathematics. This new edition includes: http://www.dropshippers.co.za/

• Excel 2007
• Addition of a glossary of key terms
• Functions list in English and Euro languages
• Continuity check on all formats, layouts and charts
• More worked examples
• Addition of exercises at the end of each chapter to help build models
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About the authors http://www.dropshippers.co.za/

Alastair Day has worked in the finance industry for more than 25 years in treasury and marketing functions and was formerly a director of a vendor leasing company specializing in the IT and technology industries. After sale to a public company he established Systematic Finance as a consultancy specializing in: http://www.dropshippers.co.za/

■ Financial modelling – review, design, build and audit http://www.dropshippers.co.za/

■ Training in financial modelling, corporate finance, leasing and credit analysis on an in-house and public basis throughout Europe, Middle East, Africa, Asia and America http://www.dropshippers.co.za/

■ Finance and operating lease structuring as a consultant and lessor http://www.dropshippers.co.za/

Alastair is author of three modelling books published by FT Prentice Hall: Mastering Financial Modelling, Mastering Risk Modelling and Mastering Financial Mathematics in Excel, all of which are in their second editions, as well as other books and publications on financial analysis and leasing. http://www.dropshippers.co.za/

Alastair has a degree in Economics and German from London University and an MBA from the Open University Business School. http://www.dropshippers.co.za/

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Table of Contents

Table of Contents

• Acknowledgements
• About the Author
• Conventions
• Overview
• Warranty and disclaimer
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1 Introduction

• Overview
• Common Excel errors
• Systematic design method
• Auditing
• Summary
• Exercises
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2 Basic financial arithmetic

• Simple interest
• Compound interest
• Nominal and effective rates
• Continuous discounting
• Conversions and comparisons
• Exercise
• Summary
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3 Cash flows

• Net present value
• Internal rate of return
• XNPV and XIRR
• XNPV periodic example
• Modified internal rate of return
• Exercise
• Summary
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4 Bonds calculations

• Description
• Cash flows
• Zero coupons
• Yield
• Yield to call
• Price and yield relationship
• Yield curve pricing
• Other yield measures
• Yield measures
• Exercise
• Summary
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5 Bonds risks

• Risks
• Duration
• Convexity
• Comparison
• Exercise
• Summary
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6 Floating rate securities

• Floating rates
• Characteristics of interest rate securities
• Yield evaluation
• Coupon stripping
• Exercise
• Summary
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7 Amortization and depreciation

• Amortization
• Full amortization
• Delayed payments
• Sum of digits
• Straight line and declining balance depreciation
• UK declining balance method
• Double declining balance depreciation
• French depreciation
• Exercise
• Summary
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8 Swaps

• Definitions
• How swaps save money
• Advantages of swaps
• Terminating interest rate swaps
• Implicit credit risk
• Worked single currency swap
• Valuation
• Cross currency swap
• Worked example
• Swaptions
• Exercise
• Summary
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9 Forward interest rates

• Definitions
• Example forward rates
• Hedging principles
• Forward rate agreement
• Yield curves
• Exercise
• Summary
• 10 Futures
• Futures market
• Terminology
• Benefits
• Clearinghouse operation
• Bond futures
• Hedging mechanisms
• Hedging example one
• Hedging example two
• Exercise
• Summary
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11 Foreign exchange

• Risk
• Spot rates
• Longer dates
• Equivalence
• Comparisons and arbitrage
• Exercise
• Summary
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12 Options

• Description
• Terminology
• Underlying asset
• Call options
• Put options
• Example
• Covered call
• Insurance using a stock and a long put
• Pricing models
• Black Scholes model
• Call put parity
• Greeks
• Binomial models
• Comparison to Black Scholes
• Exercise
• Summary
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13 Real options

• Real options
• Black Scholes model
• Binomial model
• Exercise
• Summary
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14 Valuation

• Valuation methods
• Assets
• Market methods
• Multi-period dividend discount models
• Free cash flow valuation
• Adjusted present value
• Economic profit
• Exercise
• Summary
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15 Leasing

• Economics of leasing
• Interest rates
• Classification
• Amortization
• Accounting
• Settlements
• Lessor evaluation
• Lessee evaluation
• Exercise
• Summary
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16 Basic statistics

• Methods
• Descriptive statistics
• Probability distributions
• Sampling/Central Limit Theorem
• Hypothesis testing
• Correlation and regression
• LINEST function
• Exercise
• Summary
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Appendix

Glossary

• Index
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