Investment and securities Books

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Book SynopsisFor decades, discussions of financial markets have primarily centred on prices. In this book for practitioners, researchers and advanced students, the authors present an alternative approach - the microstructure approach - by considering the micro-scale actions of individual traders, and addressing many long-standing questions regarding market fairness, stability, and optimal trading.Trade Review'Leading physicist and hedge fund manager Jean-Philippe Bouchaud and his co-authors have written an impressive book that no serious student of market microstructure can afford to be without. Simultaneously quantitative and highly readable, Trades, Quotes and Prices presents a complete picture of the topic, from classical microstructure models to the latest research, informed by years of practical trading experience.' Jim Gatheral, Baruch College, City University of New York'This book describes the dynamics of supply and demand in modern financial markets. It is a beautiful story, full of striking empirical regularities and elegant mathematics, illustrating how the tools of statistical physics can be used to explain financial exchange. This is a tour de force with the square root law of market impact as its climax. It shows how institutions shape human behaviour, leading to a universal law for the relationship between fluctuations in supply and demand and their impact on prices. I highly recommend this to anyone who wants to see how physics has benefited economics, or for that matter, to anyone who wants to see a stellar example of a theory grounded in data.' Doyne Farmer, University of Oxford'This is a masterful overview of the modern and rapidly developing field of market microstructure, from several of its creators. The emphasis is on simple models to explain real and important features of markets, rather than on sophisticated mathematics for its own sake. The style is narrative and illustrative, with extensive references to more detailed work. A unique feature of the book is its focus on high-frequency data to support the models presented. This book will be an essential resource for practitioners, academics, and regulators alike.' Robert Almgren, New York University and Quantitative BrokersTable of ContentsPreface; Part I. How and Why Do Prices Move?: 1. The ecology of financial markets; 2. The statistics of price changes: an informal primer; Part II. Limit Order Books: Introduction: 3. Limit order books; 4. Empirical properties of limit order books; Part III. Limit Order Books: Models: 5. Single-queue dynamics: simple models; 6. Single-queue dynamics for large-tick stocks; 7. Joint-queue dynamics for large-tick stocks; 8. The Santa Fe model for limit order books; Part IV. Clustering and Correlations: 9. Time clustering and Hawkes processes; 10. Long-range persistence of order flow; Part V. Price Impact: 11. The impact of market orders; 12. The impact of metaorders; Part VI. Six Market Dynamics at the Micro-scale: 13. The propagator model; 14. Generalised propagator models; Part VII. Adverse Selection and Liquidity Provision: 15. The Kyle model; 16. The determinants of the bid–ask spread; 17. The profitability of market making; Part VIII. Market Dynamics at the Meso-scale: 18. Latent liquidity and Walrasian auctions; 19. Impact dynamics in a continuous-time double auction; 20. The information content of prices; Part IX. Practical Consequences: 21. Optimal execution; 22. Market fairness and stability; 23. Appendices; Index.

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Book SynopsisAn accessible guide to enterprise risk management for financial institutions, containing all the tools needed to build and maintain an ERM framework. This new expanded edition has been thoroughly updated to reflect new legislation and the creation of the Financial Conduct Authority and the Prudential Regulation Authority.Trade ReviewReview of previous edition: 'Provides all the tools required to build and maintain a comprehensive ERM framework, covering a range of qualitative and quantitative techniques and their uses in identifying, assessing, modelling and measuring risk.' Actuary Magazine'In total, this book provides not only a very comprehensive and accessible introduction to financial enterprise risk management, but also covers advanced topics such as Bayesian networks and current regulatory developments such as Basel III. It clearly demonstrates the importance of risk management for financial institutions and outlines detailed steps and procedures that can be taken to obtain a firm understanding of risk. The book discusses the specific advantages and limitations of current risk management tools and frameworks and provides rich guidance on how to implement ERM on a comprehensive level.' Matthias M. M. Buehlmaier, zbMATHTable of Contents1. An introduction to enterprise risk management; 2. Types of financial institution; 3. Stakeholders; 4. The internal environment; 5. The external environment; 6. Process overview; 7. Definitions of risk; 8. Risk identification; 9. Some useful statistics; 10. Statistical distributions; 11. Modelling techniques; 12. Extreme value theory; 13. Modelling time series; 14. Quantifying particular risks; 15. Risk assessment; 16. Responses to risk; 17. Continuous considerations; 18. Economic capital; 19. Risk frameworks; 20. Case studies; 21. Solutions to questions; References; Index.

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Book SynopsisIn an era defined by financial upheaval, few parts of the economy have witnessed the kind of volatility seen in commodities markets. In this book, Blake Clayton, a Wall Street analyst and adjunct fellow at the Council on Foreign Relations, draws on the latest thinking from academia and the private sector to deliver a clear-eyed analysis of pressing questions at the intersection of commodity markets, natural resource economics, and public policy. The result is a work that challenges the conventional wisdom about how these markets function and provides a fresh perspective on what public policy can do to improve them.Trade Review'Through his experience in the academy, think-tanks, and leading private companies, Dr Blake Clayton is uniquely well-placed to make sense of the complex events of the recent past in the highly volatile commodity markets. Accordingly, if one wants an accessible, even-handed view of the myriad of competing forces that are shaping commodity markets, a reader will not be able to find a better book than Commodity Markets and the Global Economy.' Hilary Till, Principal, Premia Capital Management, LLC, and Co-Editor, Intelligent Commodity Investing'Blake Clayton's book is a sweeping analysis of rapidly changing commodity markets, a highly volatile sector with important consequences for the rest of the economy. He describes the massive financial influx into commodity markets over the last decade and explores its consequences. Most valuably, he organizes his analysis around four central tensions: between net importers and net exporters; governments and private companies; nationalism and international cooperation; and physical and financial aspects of the modern commodity trade. Clayton demonstrates superb judgment and intuition in identifying crucial issues and questions.' Jeff D. Colgan, Brown University, Rhode Island'This book of essays by Blake Clayton is unified by its focus on what is new and what is persistent about commodities in the global economy and what has brought them to the fore of debates both national and global over the past fifteen years. It is a brave and distinguished effort to enhance our understanding of the geoeconomics of commodities.' Edward L. Morse, Managing Director and Global Head of Commodity Research, Citigroup'An illuminating look at commodity markets and the pivotal issues surrounding them. Blake Clayton places the recent developments regarding several critical commodities in a broad historical context, giving the reader valuable insights and a framework to better understand the scope of challenges in these markets.' Mine Yücel, Federal Reserve Bank of Dallas'In this quick read, commodity expert Blake C. Clayton provides a good overview of key supply and demand issues in the varied global markets.' Mark S. Rzepczynski, CFA Institute Book ReviewsTable of Contents1. Introduction: the revenge of the old economy; 2. A twenty-first-century supercycle? Long-term trends in metal and energy prices; 3. Volatility in global food markets; 4. Financial speculation in commodities markets; 5. The implications of oil prices for the US economy and lessons learned from the 2011 Strategic Petroleum Reserve release; 6. The gold standard as an alternative money regime; 7. Conclusion.

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Book SynopsisPrivate equity-backed companies are ubiquitous and economically significant. Consequently, the corporate governance of these companies matters to all of us, and not surprisingly is coming under increasing scrutiny. Simon Witney, a practicing private equity lawyer, positions private equity portfolio companies within existing academic theory and examines the laws that apply to them in the UK. He analyses the actual governance frameworks that are put in place and identifies problems created by the legal rules as well as the market''s solutions to them. This book not only explains why these governance mechanisms are established, but also what they are expected to achieve. Witney suggests that private equity owners have both the incentives and the capability to focus on responsible investment practices. Good governance, he argues, is a critical success factor for the private equity industry.Trade Review'At long last, we have an academic work that analyses private equity within a specifically legal frame of reference. This book provides a highly illuminating exposition of the contractual and governance dynamics of private equity ownership structures and incentives, set against the backdrop of established company law doctrines and corporate governance theories. Combining theoretical sophistication with a hard-nosed commercial pragmatism borne from extensive professional experience in the field, Witney's work is a monumental scholarly achievement. It will also be an indispensable guide for academics, legal practitioners and private equity investors alike as they seek to navigate the complex and shifting parameters of an ESG-focused, post-Covid investment and business landscape.' Marc Moore, Professor of Corporate/Financial Law, University College London and author of Corporate Governance in the Shadow of the State'This rich and substantial book achieves the rare distinction of genuinely offering something new for practitioners, scholars and policy makers engaging with corporate governance and the private equity industry.' Sarah Paterson, Associate Professor of Law, London School of Economics and Political Science'Good governance is at the heart of Private Equity value creation. Rare to find such a good balance of the practical and academically rigorous on the topic.' Patrick Dunne, Chair, EY Foundation and author of Boards'The author's intellectual rigour, academic curiosity and practical experience combine to make this book a recommended handbook for private equity lawyers and practitioners alike.' Ylan Steiner, Partner, Orrick and leading venture capital and growth capital lawyer'This book's comprehensive and authoritative analysis of private equity governance - which is at the heart of the private equity model - makes a very important contribution to our understanding of the asset class.' Jonathan Blake, Herbert Smith Freehills LLP and leading private equity lawyer'… readers - especially regulators, company management, and investors - will find in this comprehensive text the answers to many of their questions regarding effective governance and responsible investment of private equity. Most will take the information provided as justification for their confidence in private equity–backed investing.' Janet J. Mangano, CFA InstituteTable of ContentsIntroduction; Part I. How Should Private Equity Governance Systems Look?: 1. Mapping an analytical framework; 2. Private ordering in private equity and its implications; Part II. What Actually Happens?: 3. Agency cost mitigation; 4. Improving decision-making and protecting wider interests; Part III. Corporate Governance Regulation in the UK and Private Equity's Response: 5. The relevance of business judgement regulation; 6. Dealing with the duties to avoid and disclose conflicts of interest; 7. Rules affecting the exercise of power by shareholders and their nominated directors; 8. Recent corporate governance reforms, best practice codes and their impact; Part IV. How Governance Can Affect Corporate Performance: 9. How do academics explain private equity outperformance? 10. Improving governance to improve performance; Conclusion. Corporate governance and responsible investment; Bibliography; Index.

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Book SynopsisTo supplement replacement income provided by Social Security and employersponsored pension plans, individuals need to rely on their own saving and investment choices during accumulation. Once retired, they must also decide at which rate to spend their savings, with the usual dilemma between present and future consumption in mind. This Element explains how financial engineering and risk management techniques can help them in these complex decisions. First, it introduces ''retirement bonds'', or retirement bond replicating portfolios, that provide stable and predictable replacement income during the decumulation period. Second, it describes investment strategies that combine the retirement bond with an efficient performanceseeking portfolio so as to reduce uncertainty over the future amount of income while offering upside potential. Finally, strategies using risk insurance techniques are proposed to secure minimum levels of replacement income while giving the possibility of reaching highTable of Contents1. Introduction; 2. Why retirement investing matters; 3. The decumulation problem: how to annuitize?; 4. Retirement bonds and their usage; 5. Improving accumulation products; 6. Applying risk­budgeting techniques in retirement investing; 7. Conclusion: the future of retirement investing.

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Book SynopsisOver the years, market developments have proven the wisdom of Graham's strategies. This edition includes commentary by financial journalist, Jason Zweig, whose perspective incorporates the realities of the market, draws parallels between Graham's examples and financial headlines, and gives an understanding of how to apply Graham's principles.

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Book SynopsisTrade Review"[Nations] has studied the math and history of market volatility, and his new book focuses on the psychology that drives it. ... The Anxious Investor weaves the latest behavioral finance studies into an engaging narrative history. ... Investors might do well to review the lessons shared in Mr. Nations’s book—and to try to conquer the anxiety that volatility can create even for the most seasoned and thoughtful financiers." — Wall Street Journal "I often say that fear, greed, hope, and ignorance are the four horsemen of the investment apocalypse, and note, only one is not an emotion. Emotional decisions may be made in the heat of a market meltdown, but also when markets are seemingly going to the moon. In The Anxious Investor, Scott Nations offers a close look at why these emotions are so destructive to your investment goals and offers a checklist of these emotional biases to help the reader understand and avoid them. The next time the market gets crazy, having this book by your side may help you overcome those four horsemen and stick with your long-term objectives." — JIM O'SHAUGHNESSY, New York Times Bestselling Author of What Works on Wall Street “Financial instruments and technology have evolved since the first market bubble in 1720, but across three-hundred years of manias and panics one aspect of markets remains unchanged: human nature. Through fascinating case studies, Scott Nations reveals why investors repeatedly succumb to the same behavioral shortcomings, and how to avoid them when times get tough. Nations’ entertaining and educational style makes this book accessible for all investors interested in the psychology of markets.” — JAMIE CATHERWOOD, "The Finance History Guy" "It's been remarked that if you don't know who you are, the stock market is an expensive place to find out. With his new book, Scott Nations explains why mastering your own mental state is the most critical variable of all." — JOSHUA BROWN, CEO of Ritholtz Wealth Management and CNBC Contributor "Nations’s advice is grounded and practical, and the wealth of research backing it will leave readers feeling like they’re in good hands. New and seasoned investors alike will find this worth a look." — Publishers Weekly

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Book SynopsisMad Money host Jim Cramer shows you how to invest your savings and turn them into real, lasting wealth.   Tired of phony promises about getting rich quickly? How about trying something different? How about going for lasting wealth—and doing it the cautious way? In Get Rich Carefully, Jim Cramer draws on his unparalleled knowledge of the stock market to help you navigate our recovering economy and make big money without taking big risks. In plain English, Cramer lays it on the line. No-waffling, no on-the-one-hand-or-the-other hedging, just the straight stuff. He names names, highlights individual and sector plays, identifies the long-term investing themes—and explains how to develop the discipline you need to exploit them. An invaluable personal finance book, Get Rich Carefully is your guide to turning your savings into real, lasting wealth in a practical, highly readable, and entertaining way.

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Book SynopsisThe inside story of one of the world?s most powerful financial InstitutionsNow with a new foreword and final chapter, The Partnership chronicles the most important periods in Goldman Sachs?s history and the individuals who built one of the world?s largest investment banks. Charles D. Ellis, who worked as a strategy consultant to Goldman Sachs for more than thirty years, reveals the secrets behind the firm?s continued success through many life-threatening changes. Disgraced and nearly destroyed in 1929, Goldman Sachs limped along as a break-even operation through the Depression and WWII. But with only one special service and one improbable banker, it began the stage-by-stage rise that took the firm to global leadership, even in the face of the world-wide credit crisis.

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Book SynopsisThis book is the distillation of three decades of analysis of the fundamentals of investing. It is sure to be your ultimate guide to wealth creation.

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Book SynopsisDerivatives were responsible for one of the worst financial meltdowns we have ever seen, one from which we have not yet fully recovered. However, they are likewise capable of generating some of the most incredible wealth we have ever seen. This book asks how we might ensure the latter while avoiding the former. Looking past the usual arguments for the regulation or abolition of derivative finance, it asks a more probing question: what kinds of social institutions and policies would we need to put in place to both avail ourselves of the derivative's wealth production and make sure that production benefits all of us? To answer that question, the contributors to this book draw upon their deep backgrounds in finance, social science, art, and the humanities to create a new way of understanding derivative finance that does justice to its social and cultural dimensions. They offer a two-pronged analysis. First, they develop a social understanding of the derivative that casts it in the light o

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Book Synopsis"Paul Krugman is a hero of mine. Read his book."—Al FrankenTrade Review"A rigorously argued, angrily eloquent, fiercely patriotic book." -- Boston Sunday Globe"Paul Krugman is the indispensable American columnist, a voice of truth in a political world of lies and calculated injustice. This book is even better. It makes the case, unrestrained by deference, that a revolutionary right-wing movement is out to transform the United States-and is succeeding, rolling over a supine press and political opposition." -- Anthony Lewis"Paul Krugman is the great discovery of recent American journalism. Lively, lucid, witty, superbly informed, his commentary on the state of the union is required reading for anyone concerned about the American future." -- Arthur M. Schlesinger, Jr."The title of Paul Krugman's The Great Unraveling might well have been The Great Usurpation. In a republic hijacked by the radical right whose leaders reject the legitimacy of our current political system, Paul Krugman's coruscant book calls for a "great revulsion" across the land before it is too late." -- David Levering Lewis, author of W.E.B. DuBois: Biography of a Race"If I had a tenth of Paul Krugman's brain and a twentieth of his courage, I'd be the happiest person on the face of the Earth." -- James Carville"The new Krugman book documents why this top-drawer academic economist deserves at least one Pulitzer Prize for his accurate Times op-ed columns that are a lone voice, telling things as they are and debunking Washington policies that are neither compassionate nor conservative. Plutocratic democracy is in the saddle. Rx. Krugman twice a week and in this coherent sum-up on relevant 2003-2010 economics. Buy. Read. Ponder. Benefit." -- Paul A. Samuelson, Institute Professor Emeritus, Massachusetts Institute of Technology

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Book SynopsisThe essential stock market guide for beginners, updated with timely strategies for investing your money. The perfect gift for anyone hoping to learn the basics of investing. Now in its fifth edition, The Neatest Little Guide to Stock Market Investing has established itself as a clear, concise, and highly effective approach to stocks and investment strategy. Rooted in the principles that made it invaluable from the start, this completely revised and updated edition of The Neatest Little Guide to Stock Market Investing shares a wealth of information, including: •What has changed and what remains timeless as the economy recovers from the subprime crash •All-new insights from deep historical research showing which measurements best identify winning stocks •A rock-solid value averaging plan that grows 3 percent per quarter, regardless of the economic climate •An exclusive conversation with legendary Legg M

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Book SynopsisHelps FOREX traders learn effective methods for dealing with trades that are in a losing position Guides traders through the various steps to determine if the trade is with or against the overall trend Explains how to determine when a trade should be closed or left open.Table of ContentsForward. Acknowledgments. Introduction. Chapter 1. Trading Systems. Chapter 2. Trend Lines & Trend Walls. Chapter 3. Convergence & Divergence. Chapter 4. The Bad Trade. Chapter 5. Bad Trade Recovery. Chapter 6. Loss Recovery with MACD. Chapter 7. Loss Recovery with Stochastics. Chapter 8. Loss Recovery with Moving Averages. Chapter 9. Loss Recovery with Fibonacci Ranges. Chapter 10. Loss Recovery with Trend Lines. Conclusion. Loss Recovery in Practice. Appendix. Ten Pips per Day. About the Author. Index.

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Book SynopsisMainstay reference guide for wealth management, newly updated for today's investment landscape For over a decade, The New Wealth Management: The Financial Advisor's Guide to Managing and Investing Client Assets has provided financial planners with detailed, step-by-step guidance on developing an optimal asset allocation policy for their clients.Table of ContentsAcknowledgments ix Foreword xi Preface xiii CHAPTER 1 The Wealth Management Process 1 CHAPTER 2 Fiduciary and Professional Standards 13 CHAPTER 3 Client Goals and Constraints 33 CHAPTER 4 Risk Is a Four-Letter Word 55 CHAPTER 5 Data Gathering and Analysis 75 CHAPTER 6 Client Education 103 CHAPTER 7 Mathematics of Investing 121 CHAPTER 8 Investment Theory 149 CHAPTER 9 Asset Allocation 179 CHAPTER 10 Portfolio Optimization 193 CHAPTER 11 Taxes 233 CHAPTER 12 Retirement Planning 267 CHAPTER 13 Investment Policy Statement 313 CHAPTER 14 Portfolio Management 341 CHAPTER 15 Performance Appraisal and Evaluation 373 CHAPTER 16 Selecting Investment Managers 393 CHAPTER 17 Philosophy, Process, and People 421 About the Authors 439 About the CFA Institute Investment Series 441 About the CFA Program 445 Index 447

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Book SynopsisA road map for the future of the world market "Bryan has emerged as an influential voice on regulatory issues. "--The New York Times The world is on the verge of the most sweeping economic changes since the Industrial Revolution.Table of ContentsGlobal Capital Revolution. MARKET UNBOUND. Market Unbound. Hunting for Woolly Mammoths. Trees Don't Grow in the Sky. Approaching Absolute Zero. UNLEASHING GLOBAL CAPITALISM. Prosperity or Devastation? Superconductivity. Heroes to Lead Us (Not Politicians). CAPTURING THE OPPORTUNITY. The Unfettered, Unrelenting Search for Profit. Leading a Corporation in a Superconductive World. Buy Stocks, Shun Bonds. Stop Worrying and Learn to Love the Market. About the Authors. Index.

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Book SynopsisFrom the Financial Times''s global finance correspondent, the incredible true story of the iconoclastic geeks who defied conventional wisdom and endured Wall Street''s scorn to launch the index fund revolution, democratizing investing and saving hundreds of billions of dollars in fees that would have otherwise lined fat cats'' pockets.Fifty years ago, the Manhattan Project of money management was quietly assembled in the financial industry''s backwaters, unified by the heretical idea that even many of the world''s finest investors couldn''t beat the market in the long run. The motley crew of nerds—including economist wunderkind Gene Fama, humiliated industry executive Jack Bogle, bull-headed and computer-obsessive John McQuown, and avuncular former WWII submariner Nate Most—succeeded beyond their wildest dreams. Passive investing now accounts for more than $20 trillion, equal to the entire gross domestic product of the US, and is today a force

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Book SynopsisMust-have advice for financial success to modern investingEasy, accessible, and to the point, Stock Market Investing Fast-Track gets you up to speed quickly on the essential strategies and techniques you need to make money in the modern stock market. In this new and improved guide, you'll find: Pointers on identifying, analyzing, and buying the right stocks at the right timeAdvice on minimizing your risks and maximizing your rewards on purchases Tips on when to buy, when to sell, and when to let it rideA look at common investing mistakes and how to avoid them Guidance on managing your portfolio for long-term successA rundown of best practices on investing in cryptocurrency  

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Book SynopsisIn this thought-provoking volume, scholars offer evidence, insights, and ideas on key policy questions affecting education - such as national exams, accountability, performance, and other vital issues, while detailing the importance of education to both the individual and society as a whole.

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Book SynopsisThis work presents a scientific, objective approach to market forecasting with the Elliot Wave Theory. It takes the guesswork out of Elliot Wave Analysis. Neely provides a comprehensive and detailed guide for all investors serious about finding accurate solutions to difficult markets.

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Book SynopsisThe book that applies behavioral finance to the real world Understanding how to use behavioral finance theory in investing is a hot topic these days.Table of ContentsPreface xv Acknowledgments xxiii Part One Introduction to Behavioral Finance 1 Chapter 1 What Is Behavioral Finance? 3 Behavioral Finance: The Big Picture 4 Standard Finance versus Behavioral Finance 12 The Role of Behavioral Finance with Private Clients 19 How Practical Application of Behavioral Finance Can Create a Successful Advisory Relationship 19 Notes 21 Chapter 2 The History of Behavioral Finance Micro 23 Historical Perspective on the Link between Psychology and Economics 23 Modern Behavioral Finance 27 Psychographic Models Used in Behavioral Finance 36 Notes 40 Chapter 3 Introduction to Behavioral Biases 43 Introduction 43 Behavioral Biases Defined 44 Why Understanding and Identifying Behavioral Biases Is Important 45 Categorization of Behavioral Biases 46 Differences between Cognitive and Emotional Biases 46 Difference among Cognitive Biases 47 Emotional Biases 48 A Final Word on Biases 49 Summary of Part One 50 Part Two Belief Perseverance Biases Defined and Illustrated 51 Chapter 4 Cognitive Dissonance Bias 53 Bias Description 53 Practical Application 55 Research Review 57 Diagnostic Testing 59 Advice 60 Conclusion 62 Notes 62 Chapter 5 Conservatism Bias 63 Bias Description 63 Practical Application 64 Research Review 67 Diagnostic Testing 69 Advice 70 Notes 71 Chapter 6 Confirmation Bias 73 Bias Description 73 Practical Application 75 Research Review 77 Diagnostic Testing 81 Advice 83 Notes 84 Chapter 7 Representativeness Bias 85 Bias Description 85 Practical Application 87 Research Review 89 Diagnostic Testing 93 Advice 94 Notes 97 Chapter 8 Illusion of Control Bias 99 Bias Description 99 Practical Application 100 Research Review 103 Diagnostic Testing 104 Advice 105 Final Thought 106 Notes 106 Chapter 9 Hindsight Bias 107 Bias Description 107 Practical Application 108 Research Review 109 Diagnostic Testing 112 Advice 113 Notes 114 Part Three Information Processing Biases Defined and Illustrated 117 Overview of the Structure of Chapters 10 through 16 117 Chapter 10 Mental Accounting Bias 119 Bias Description 119 Practical Application 121 Research Review 123 Diagnostic Testing 128 Advice 130 The Behavioral Finance Approach to Asset Allocation based on Mental Accounting 133 Notes 134 Chapter 11 Anchoring and Adjustment Bias 135 Bias Description 135 Practical Application 136 Research Review 138 Diagnostic Testing 139 Advice 140 Bonus Discussion: Investment Strategies that Leverage Anchoring and Adjustment Bias 141 Notes 142 Chapter 12 Framing Bias 143 Bias Description 143 Practical Application 145 Research Review 148 Diagnostic Testing 150 Advice 152 Notes 153 Chapter 13 Availability Bias 155 Bias Description 155 Practical Application 157 Research Review 160 Diagnostic Test 162 Advice 163 Notes 164 Chapter 14 Self-Attribution Bias 165 Bias Description 165 Practical Application 166 Research Review 167 Diagnostic Testing 169 Advice 170 Notes 171 Chapter 15 Outcome Bias 173 Bias Description 173 Diagnostic 176 Notes 178 Chapter 16 Recency Bias 179 Bias Description 179 Practical Application 181 Research Review 184 Diagnostic Testing 185 Advice 187 Notes 188 Part Four Emotional Biases Defined and Illustrated 189 Chapter 17 Loss Aversion Bias 191 Bias Description 191 Practical Application 193 Research Review 194 Diagnostic Testing 195 Advice 196 Notes 197 Chapter 18 Overconfidence Bias 199 Bias Description 199 Practical Application 200 Research Review 201 Diagnostic Testing 203 Advice 206 A Final Word on Overconfidence 208 Notes 208 Chapter 19 Self-Control Bias 211 Bias Description 211 Practical Application 214 Research Review 216 Diagnostic Testing 219 Advice 220 Notes 222 Chapter 20 Status Quo Bias 223 Bias Description 223 Practical Application 224 Research Review 225 Diagnostic Testing 226 Advice 228 Notes 229 Chapter 21 Endowment Bias 231 Bias Description 231 Practical Application 232 Research Review 235 Diagnostic Testing 237 Advice 239 Notes 240 Chapter 22 Regret Aversion Bias 243 Bias Description 243 Practical Application 244 Research Review 246 Diagnostic Testing 247 Advice 249 Notes 251 Chapter 23 Affinity Bias 253 Bias Description 253 Research Review 256 Diagnostic Testing 258 Advice 259 Notes 260 Part Five Application of Behavioral Finance to Asset Allocation and Case Studies 261 Chapter 24 Application of Behavioral Finance to Asset Allocation 263 Practical Application of Behavioral Finance 264 Best Practical Allocation 266 Guidelines for Determining Best Practical Asset Allocation 267 Quantitative Guidelines for Incorporating Behavioral Finance in Asset Allocation 269 Investment Policy and Asset Allocation 271 Notes 271 Chapter 25 Case Studies 273 Case Study A: Mr. Nicholas 276 Case Study B: Mrs. Alexander 281 Summary of Case Studies 286 Part Six Behavioral Investor Types 287 Chapter 26 Behavioral Investor Type Diagnostic Process 289 Background of the Development of Behavioral Investor Types 290 Psychographic Models of Investor Behavior 291 Early Psychographic Models 293 The Behavioral Alpha Process: A Top-Down Approach 295 The BIT Identification Process 296 Summary 299 Notes 300 Chapter 27 Behavioral Investor Types 301 Introduction 301 Preserver 302 Follower 305 Independent 308 Accumulator 312 Summary 315 Index 317

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Book SynopsisTable of Contents1 The Financial Manager and the Firm 1-1 1.1 The Role of the Financial Manager 1-2 1.2 Forms of Business Organization 1-7 1.3 Managing the Financial Function 1-10 1.4 The Goal of the Firm 1-13 1.5 Agency Conflicts: Separation of Ownership and Control 1-16 1.6 The Importance of Ethics in Business 1-22 Summary of Learning Objectives/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: Incentives and Ethics: Cross-Selling at Wells Fargo 1-28 2 The Financial System and the Level of Interest Rates 2-1 2.1 The Financial System 2-2 2.2 Direct Financing 2-5 2.3 Types of Financial Markets 2-7 2.4 Market Efficiency 2-10 2.5 Financial Institutions and Indirect Financing 2-12 2.6 The Determinants of Interest Rate Levels 2-16 Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 3 Financial Statements, Cash Flows, and Taxes 3-1 3.1 Financial Statements and Accounting Principles 3-2 3.2 The Balance Sheet 3-5 3.4 The Income Statement and the Statement of Retained Earnings 3-14 3.5 The Statement of Cash Flows 3-17 3.6 Tying Together the Financial Statements 3-20 3.7 Cash Flow to Investors 3-22 3.8 Federal Income Tax 3-27 Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 4 Analyzing Financial Statements 4-1 4.1 Background for Financial Statement Analysis 4-2 4.2 Common-Size Financial Statements 4-4 4.3 Financial Ratios and Firm Performance 4-7 4.4 The Dupont System: A Diagnostic Tool 4-22 4.5 Selecting a Benchmark 4-27 4.6 Using Financial Ratios 4-30 Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: A Sad Tale: The Demise of Arthur Andersen 4-45 5 The Time Value of Money 5-1 5.1 The Time Value of Money 5-2 5.2 Future Value and Compounding 5-4 5.3 Present Value and Discounting 5-16 5.4 Additional Concepts and Applications 5-22Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 6 Discounted Cash Flows and Valuation 6-1 6.1 Multiple Cash Flows 6-2 6.2 Level Cash Flows: Annuities 6-9 6.3 Level Cash Flows: Perpetuities 6-22 6.4 Cash Flows That Grow at a Constant Rate 6-24 6.5 The Effective Annual Interest Rate 6-26 Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems/Appendix: Deriving the Formula for the Present Value of an Ordinary Annuity/Problem Ethics Case: America’s Ailing Drug Prices 6-38 7 Risk and Return 7-1 7.1 Risk and Return 7-2 7.2 Holding Period Returns 7-3 7.3 Expected Returns 7-4 7.4 Variance and Standard Deviation as Measures of Risk 7-8 7.5 Arithmetic Average and Geometric (Compounded) Average Returns 7-15 7.6 Risk and Diversification 7-17 7.7 Systematic Risk 7-26 7.8 The Capital Asset Pricing Model 7-31Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: Pay for Performance or Just More Pay? The Conflicting Case for CEO Pay 7-41 8 Bond Valuation and the Structure of Interest Rates 8-1 8.1 Corporate Bonds 8-2 8.2 Bond Valuation 8-4 8.3 Bond Yields 8-12 8.4 Interest Rate Risk 8-15 8.5 The Determinants of Corporate Borrowing Costs 8-18 8.6 The Term Structure of Interest Rates 8-21Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: The Subprime Mortgage Market Meltdown:How Did It Happen? 8-29 9 Stock Valuation 9-1 9.1 The Market for Stocks 9-2 9.2 Common and Preferred Stock 9-7 9.3 Common Stock Valuation 9-8 9.4 The General Dividend-Valuation Model 9-11 9.5 Stock Valuation: Some Simplifying Assumptions 9-12 9.6 The Relation between R and g 9-17 Mixed (Supernormal) Growth Dividend Model 9-18 9.7 Valuing Preferred Stock 9-21Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: Insider Trading: Have I Got a Stock Tip for You! 9-29 10 The Fundamentals of Capital Budgeting 10-1 10.1 An Introduction to Capital Budgeting 10-2 10.2 Net Present Value 10-6 10.3 The Payback Period 10-14 10.4 The Accounting Rate of Return 10-18 10.5 Internal Rate of Return 10-19 10.6 Investment Decisions with Capital Rationing 10-29 10.7 Capital Budgeting in Practice 10-33Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: Going Green: Can Automakers Invest in Environmental Solutions? 10-45 11 Cash Flows and Capital Budgeting 11-1 11.1 Calculating Project Cash Flows 11-2 11.2 Estimating Cash Flows in Practice 11-10 11.3 Forecasting Free Cash Flows 11-23 11.4 Special Cases 11-25 11.5 Harvesting an Asset 11-29Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Ethics Case: Unilever’s Sustainable Living Plan 11-37 12 Evaluating Project Economics 12-1 12.1 Variable Costs, Fixed Costs, and Project Risk 12-2 12.2 Calculating Operating Leverage 12-9 12.3 Break-Even Analysis 12-11 12.4 The Economic Break-Even Point 12-15 12.5 Risk Analysis 12-19Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 13 The Cost of Capital 13-1 13.1 The Firm’s Overall Cost of Capital 13-2 13.2 The Cost of Debt 13-7 13.3 The Cost of Equity 13-13 13.4 Using the WACC in Practice 13-21Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 14 Working Capital Management 14-1 14.1 Working Capital Basics 14-2 14.2 The Operating and Cash Conversion Cycles 14-5 14.3 Working Capital Management Strategies 14-10 14.4 Accounts Receivable 14-13 14.5 Inventory Management 14-16 14.6 Cash Management and Budgeting 14-18 14.7 Financing Working Capital 14-20Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 15 How Firms Raise Capital 15-1 15.1 Bootstrapping 15-2 15.2 Venture Capital 15-4 15.3 Initial Public Offering 15-9 15.4 IPO Pricing and Cost 15-15 15.5 General Cash Offer by a Public Company 15-19 15.6 Private Markets 15-22 15.7 Commercial Bank Loans 15-25Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 16 Capital Structure Policy 16-1 16.1 Capital Structure and Firm Value 16-2 16.2 The Benefits and Costs of Using Debt 16-11 16.3 Two Theories of Capital Structure 16-24Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems Appendix: Leasing 16-33 Two Types of Leases 16-33 Motivations for Leasing 16-34 Conflicts between Lessees and Lessors 16-37 Evaluating a Leasing Opportunity 16-39 Summary of Learning Objective/Self-Study Problem/Solution to Self-Study Problem/Discussion Questions/Questions and Problems 17 Dividends, Stock Repurchases, and Payout Policy 17-1 17.1 Dividends 17-2 17.2 Stock Repurchases 17-7 17.3 Dividends and Firm Value 17-10 17.4 Stock Dividends and Stock Splits 17-16 17.5 Setting a Dividend Payout 17-19 Summary of Learning Objectives/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 18 Business Formation, Growth, and Valuation 18-1 18.1 Starting a Business 18-2 18.2 The Role of the Business Plan 18-10 18.3 Valuing a Business 18-11 18.4 Important Issues in Valuation 18-26Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 19 Financial Planning and Managing Growth 19-1 19.1 Financial Planning 19-2 19.2 Financial Planning Models 19-5 19.3 A Better Financial Planning Model 19-11 19.4 Beyond the Basic Planning Models 19-18 19.5 Managing and Financing Growth 19-20Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 20 Options and Corporate Finance 20-1 20.1 Financial Options 20-2 20.2 Option Valuation 20-6 20.3 Real Options 20-15 20.4 Agency Costs 20-19 20.5 Options and Risk Management 20-22Summary of Learning Objectives/Summary of Key Equations/Self-Study Problems/Solutions to Self-Study Problems/Discussion Questions/Questions and Problems/Sample Test Problems 21 International Financial Management 21-1 21.1 Introduction to International Financial Management 21-2 21.2 Foreign Exchange Markets 21-7 21.3 International Capital Budgeting 21-16 21.4 Global Money and Capital Markets 21-21 21.5 International Banking 21-24 Appendix A Future Value and Present Value Tables A-1 Appendix B Solutions to Odd Problems B-1 AppendixC The 2017 Tax Cuts and Jobs Act: Implications for Cash Flow to Investors, the Cost of Capital, and Capital Structure C-1 Glossary G-1 Subject Index I-1 Company Index I-19

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Book SynopsisThe amazing and forgotten story of Wall Street's first black millionaire in pre-Civil War New York.

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Book SynopsisThis is a book of hypothetical cases written to give students real examples of key finance concepts. Each case is 3-4 pages in length, and concludes with questions and problems that walk students through calculations and critical analysis of the case to help them make business decisions.Table of Contents1 Financial Statements, Cash Flows and Taxes: Ultra Cable Corporation2 Analyzing Financial Statements: Are We Getting Too Big For Our Boots?3 DuPont Analysis: Playing the Numbers Game!4 Financial Forecasting: Growing Pains5 Financial Analysis and Forecasting: There’s More to Us Than Meets the Eye!6 Time Value of Money: Lottery Winnings – Looks Can Be Deceptive!7 Retirement Planning: It’s Better Late than Never!8 Loan Amortization: Paying Off That Dream House9 Bond Analysis and Valuation: Corporate Bonds–They Are More Complex than You Think10 Valuation of Common Stock: What Are We Really Worth?11 Estimating Cash Flow - New Project Analysis: The Lawn Robot: Is It Really Worth It?12 Capital Budgeting: Too Hot To Handle!13 Real Options and Capital Budgeting: I Wish I Had a Crystal Ball14 Divisional Costs of Capital: We Are Not All Alike!15 Marginal Cost of Capital and Capital Budgeting: Where Do We Draw The Line?16 Economic Value Added (EVA): EVA – Does It Really Work?17 Evaluating Project Risk: It’s Better to Be Safe Than Sorry!18 Debt versus Equity Financing: Look Before You Leverage!19 Bankruptcy and Reorganization: Is It Worth More Dead or Alive?20 Dividend Policy: Is It Much Ado About Nothing?21 Cash Budgeting: The Elusive Cash Balance22 International Capital Budgeting: Will It Be Worthwhile to Venture?23 Hedging with Derivatives: When in Doubt, Hedge!24 Valuing Corporate Acquisitions: Made for Each Other25 Lease Versus Buy Analysis: Why Buy It When You Can Lease It?

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Book Synopsis

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Book Synopsis

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Book Synopsis

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Book Synopsis

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Book Synopsis

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Book Synopsis

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Book Synopsis

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