Mastering Financial Mathematics in Microsoft Excel: A practical guide to business calculations (The Mastering Series)

Cover
Title Page
Copyright Page
Contents
Acknowledgements
About the author
Conventions
Overview
How to use this book
Warranty and disclaimer
1 Introduction
	Overview
	Common excel errors
	Systematic design method
	Auditing
	Summary
2 Basic Financial Arithmetic
	Simple interest
	Compound interest
	Multiple payments
	Differing interest rates
	Nominal and effective rates
	Continuous discounting
	Conversions and comparisons
	Exercise
	Summary
3 Cash flows
	Net present value
	Varying interest rates
	Internal rate of return
	XNPV and XIRR
	XNPV periodic example
	Modified internal rate of return
	Exercise
	Summary
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
5 Bond risks
	Risks
	Duration
	Convexity
	Comparison
	Exercise
	Summary
6 Floating rate securities
	Floating rates
	Characteristics of interest rate securities
	Yield evaluation
	Coupon stripping
	Exercise
	Summary
7 Amortisation and depreciation
	Amortisation
	Full amortisation
	Delayed payments
	Sum of digits
	Straight line and declining balance depreciation
	UK declining balance method
	Double declining balance depreciation
	French depreciation
	Exercise
	Summary
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
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 1
	Hedging example 2
	Exercise
	Summary
11 Foreign exchange
	Risk
	Spot rates
	Longer dates
	Equivalence
	Comparisons and arbitrage
	Exercise
	Summary
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 with Black–scholes
	Exercise
	Summary
13 Real options
	Real options
	Black–scholes model
	Binomial model
	Exercise
	Summary
14 Valuation
	Valuation methods
	Assets
	Market methods
	Multi-period dividend discount models
	Free cash flow valuation
	Adjusted present value
	Economic profit
	Exercise
	Summary
15 Leasing
	Economics of leasing
	Interest rates
	Classification
	Amortisation
	Accounting
	Settlements
	Lessor evaluation
	Lessee evaluation
	Exercise
	Summary
16 Basic statistics
	Methods
	Descriptive statistics
	Probability distributions
	Sampling/central Limit theorem
	Hypothesis testing
	Correlation and regression
	Linest function
	Exercise
	Summary
Appendices
	1 Exercise answers, functions list, software installation and licence
	2 An introduction to Microsoft®  Office
Index