Financial Derivatives 3e

"Kolb and Overdahl have produced a clear and well-written introduction to derivatives that should serve as a useful foundational text. Their mixture of mechanics, pricing, and risk management is as well-balanced as their blend of theory and practical applications."
-Christopher L. Culp, PhD, Adjunct Associate Professor of Finance at The University of Chicago's Graduate School of Business and Managing Director at CP Risk Management LLC

"The third edition of Kolb and Overdahl presents a nice blend of theory and application of financial derivatives. The concise anthology introduces institutional background and valuation issues and then shows how each instrument can be used to manage risk. This book is sure to be of interest to risk managers as well as business students about to embark on their finance careers."
-Steve Swidler, J. Stanley Mackin Professor of Finance, Auburn University

"Financial Derivatives is an excellent, accessible introduction to some of the fastest growing markets in modern finance. Kolb and Overdahl clearly explain the uses (as well as the problems underlying several well-publicized abuses) of financial derivatives as risk management tools. Practitioners, regulators, and students of finance will all profit from exercising their option to acquire this book."
-Michael Ferguson, Assistant Professor of Finance, University of Cincinnati

Financial Derivatives provides a thorough introduction to financial derivatives and their importance to risk management in the corporate setting. The book has two principal goals: to offer a broad overview of the different types of financial derivatives while focusing on the principals that determine market prices, and to present financial derivatives as a tool for risk management in a corporate setting rather than as instruments of speculation.

Financial derivatives-financial instruments whose value depends on other basic instruments, such as stocks or bonds-are one of the most important financial innovations of the last century. While they are unsurpassed as tools for speculation, financial derivatives have also emerged as important risk-management tools in the corporate world.

If you want to understand derivatives without getting bogged down by the mathematics surrounding their pricing and valuation, Financial Derivatives, Third Edition is the book for you. Through in-depth insights gleaned from years of financial experience, Robert Kolb and James Overdahl clearly explain what derivatives are and how you can prudently use them within the context of your underlying business activities.

Financial Derivatives, Third Edition will introduce you to the wide range of markets for financial derivatives. This invaluable guide offers a broad overview of the different types of derivatives-futures, options, and swaps-while focusing on the principles that determine market prices. This comprehensive resource also provides a thorough introduction to financial derivatives and their importance to risk management in a corporate setting. After each derivative is described and examined, Kolb and Overdahl address the practical applications of these instruments in the area of risk management.

Filled with helpful tables and charts, informative Q&A sections, and new chapters that reflect an increased emphasis on risk management, Financial Derivatives, Third Edition offers a wealth of knowledge on futures, options, swaps, financial engineering, and structured products. Through the process of financial engineering you will learn how to apply financial derivatives to numerous risk management scenarios.

As a financial professional, if you are looking to minimize risk and maximize profits, you must understand how to use derivatives. Fully updated and completely revised to reflect today's ever-changing economic environment, Financial Derivatives, Third Edition will help you unlock the incredible potential of financial derivatives.

ROBERT W. KOLB was John S. and James L. Knight Professor of Finance at the University of Miami until 1995. He is author or coauthor of finance texts on a range of topics including futures, options, financial derivatives, investments, corporate finance, and financial institutions. He was founder and president of Kolb Publishing Company, sold to Blackwell Publishers in 1995. His research has been published in Financial Management, the Journal of Finance, the Journal of Risk and Insurance, the Journal of Financial Economics, and the Journal of Futures Markets.

JAMES A. OVERDAHL is Chief Economist at the Commodity Futures Trading Commission in Washington, D.C. Previously, Overdahl worked in the Risk Analysis Division at the Office of the Comptroller of the Currency, performing on-site assessments of risk measurement models employed by banks to manage their exposure to risks resulting from derivatives trading and dealing activities. Overdahl has also been a senior economist with the Securities and Exchange Commission, and an adjunct professor of business at Georgetown University, Virginia Polytechnic Institute, George Mason University, and Johns Hopkins University, where he taught MBA courses on investment management, industrial organization, and derivative instruments.