Introduction to Financial Math

Using the HP 17B/19B calculator

Norman Toy

Publisher: Adkins, Matchet and Toy, 1998, 179 pages

ISBN: 1-891112-51-1

Last modified: May 21, 2007, 2:36 a.m.

Contents

  • Introduction to Capital Markets
    Learn how money works for borrowers and lenders; meet the players; get an overview of the institutions and instruments that make money available to the institutions that use it
  • Financial Math
    Learn key skills for calculating money's value over time through real-life examples and ste-by-step explanations keyed to the HP calculator
    Learn how to set up a problem so that the solutions develops naturally
  • Appendix: Basic Algebra
    Been a long time since you factored an expression? Brush up your skill or use this section as a reference as you work the financial math problems
  • Appendix: HP Calculator
    Get oriented with this handy guide to the calculator and how to use it for financial math.

Features

  • Capital Markets overview puts financial math in context
  • "Due Diligence" tests check your understanding
  • Warning signs alert you to common pitfalls
  • Tips show you the best practices in the markets
  • Sprinkled with Wall Street lingo and stories
  • Filled with real-life exercises that reinforce each concept
  • "The Underwriting" is a final case study that brings all the concepts together in a practical application
  • Frequent diagrams illustrate key concepts

Design

  • Learn by doing
  • A workbook, not a textbook
  • Builds the foundation you need to be comfortable with financial math calculations
  • Step-by-step learning. Each section contains:
    • Concept
      Overview with examples
    • The Pitch
      Introductory questiions
    • Complexities
      Overview with examples
    • The Mandate
      Advanced questions
    • Hit the Phones
      Summarizes the section
  1. The capital markets
  2. Time value of money
  3. Compound interest
  4. Zero coupon bonds
  5. Capital markets players
  6. Annuities and perpetuities
  7. Coupon bonds
  8. Recent developments in the capital markets
  9. Irregular cashflows
  10. Modified IRR
  11. Multiple IRRs
  12. All-in-Costs and Yield-to-Maturity
  13. Interest rates
  14. Simple interest
  15. Nominal interest
  16. Comparing bonds
  17. Holding period yield
  18. Constantly growing cash flows
  • The Underwriting
  • Appendices and answers
    • Appendix 1: Using your calculator
    • Appendix 2: Algebra brushup
    • Answers

Reviews

Introduction to Financial Math

Reviewed by Roland Buresund

Very Good ******** (8 out of 10)

Last modified: May 21, 2007, 3:06 a.m.

This often overlooked book is an excellent introduction to the investment and finance worlds as well as a very practical book on handling the MBA type calculations you often find yourself needing (just kidding).

Buy a HP calculator (obviously) and this book, if you envision a career in the investment world. Recommended reading, even if you don't.

Also part of Financial Business Box.

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