Why Read It?
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Introduces the world of derivatives, pricing, and risk management in clear and understandable terms.
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Provides a practitioner-focused overview of market dynamics and a feel of real market conditions.
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Offers a comprehensive overview of all the most relevant materials on the range of derivatives, together with derivations of all the formulas.
Getting Started
Options, Futures, and Other Derivatives has long been the standard text for learning about financial engineering and derivatives; now in its seventh edition, it is a comprehensive treatment of all the main topics in mathematical finance. Widely used by academics and practitioners, especially traders, it is one of the most cited books on derivatives, teaching you how to analyze and trade these products.
Author
John C. Hull (b. 1946) is professor of derivatives and risk management at the Rotman School of Management, University of Toronto. He has acted as consultant to several financial institutions, won many teaching awards, and was voted Financial Engineer of the Year by the International Association of Financial Engineers in 1999.
Context
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Bridges the gap between the theory and practice of derivatives, and helps develop a working knowledge of how derivatives can be analyzed.
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Examines in detail the valuation of derivatives, presenting a unifying framework for derivative valuation.
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Provides a good grounding in pricing derivatives and explains clearly all the techniques you need for numerical valuation.
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Describes the basic principles of derivatives theory, and presents them in an intuitive way.
Impact
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The mathematics is stripped down to essentials, allowing you to quickly grasp the key assumptions underlying various models.
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Suitable for practitioners who want to acquire a working knowledge of how to analyze derivatives, and by MBAs who need a solid grounding in derivatives but want to avoid too much math.
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Updated to include new material on using futures for hedging, numerical procedures, swaps, credit risk, real options, insurance, and derivative crises.
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Includes MS Excel-based software that allows users to calculate options prices, imply volatilities, and calculate Greeks for European options, American options, exotic options, and interest rate derivatives.
Quotations
“We have now reached the stage where anyone who works in finance needs to understand how derivatives work, how they are used, and how they are priced.”
“To avoid the sort of problems Barings encountered, it is very important for both financial and nonfinancial corporations to set up controls to ensure that derivatives are being used for their intended purpose.”
“It is essential that all companies define in a clear and unambiguous way limits to the financial risks that can be taken.”
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