Fixed Income Securities: Valuation, Risk, and Risk Management 1st edition, Pietro Veronesi

"This book is a much needed guide to the complex landscape of modern fixed income securities and derivatives markets. Drawing on a few simple principles, but never neglecting the crucial details of each market, Pietro Veronesi lucidly explains how to model and manage fixed income risks." - John Y. Campbell, Department Chair, Harvard University Department of Economics

"Pietro Veronesi has given us an instant classic on fixed income markets. This book takes a completely new approach to the subject, combining a rich set of modeling issues with excellent intuition and coverage of institutional details." - Darrell Duffie, Dean Witter Distinguished Professor of Finance, Stanford University Graduate School of Business

"Veronesi's book provides a new standard reference for students of fixed income markets. Veronesi presents his material using easy to follow arguments and prose making the book easily accessible to students who are new to these markets. In addition, Veronesi provides a wonderful set of examples based on real-world data and situations. These examples provide readers with a deeper understanding of both the pricing of fixed income securities and the working of the markets. Even experts in the field will find his examples very insightful. Highly recommended reading!" - John C. Heaton, Joseph L. Gidwitz Professor of Finance, The University of Chicago Booth School of Business

"This is an extraordinarily comprehensive treatment of the pricing and hedging of fixed-income securities. Professor Veronesi's masterful blending of theory and practice highlights the growing importance of fixed-income markets in the global economy while making the many complex products and risk management problems fully accessible. It will surely become a "must have" reference for academics and practitioners alike." - Kenneth J. Singleton, Adams Distinguished Professor of Management, Stanford University Graduate School of Business

"I just taught a class using this book, and believe there is currently no better fixed income textbook on the market. It has an unmatched combination of rigorous coverage, user-friendly worked examples, and institutional detail, making it a pleasure to teach (and to learn) from." - Richard Stanton, Professor of Finance and Barbara and Gerson Bakar Faculty Fellow, Haas School of Business, University of California, Berkeley

If you are looking for a great book on fixed income, teaching you how to do pricing and understand concepts being both practical and rigorous, this is the one.

If you are looking for a baby introduction, with no formulas, no math, this is not for you. But for people interested in getting sophisticated the book teaches you what you need.

Fantastic book, written by a great leading finance professor.

The worst book I ever seen in my life. Unlike others, I think this book is very bad!! The logic is unclear, use too much formula while no detail explaination. Also, the book make everything mass up! The author make everything so difficult while I have to say it was really miss leading! It should be much easier. For example, the duration thing it does not cover clearly, while you are using spot rate or YTM you should make it clear, the book is not! Also, the call option thing, totally mass! It cover something that is usless while ignor important things. The worst book I ever purchase. Do not buy this book!! IT is expensive it is confusing, it is BAD!

lets just say this guy could be the Father of Fixed Income Securities. Very well written with examples relevant and has numerous case studies i.e bankruptsy of orange county etc. also he doesn't skimp on the mathematics either. He first explains through examples and then proves it mathematically. If only all fin math books were written this way

I read the book through and through while taking the author's course on Fixed Income Asset Pricing at The University of Chicago, and I ,must say, unlike one of the reviewers, I did not encounter more than 10-15 typos throughout the book (and I usually notice them). The book is incredibly clear, very suitable for self-study, and the examples are easy to understand. The data provided actually makes things that much more concrete, which helps if you want to build code to implement the pricing methods discussed. I highly recommend the book for a practitioner as the book never gets bogged down by the mathematics or complicated proofs, - the math is there - but the "proof" is in the incredible intuition the author conveys for the equations and the formulas. Incredible work and a book I often refer to.

Finance books aimed at quantitative MBAs either seem to overdo the math and hide what operatively is going on, or present you with a meaningless string of formulas. Fixed Income Securities does a good job of showing where simple half page types of derivations come from, drastically reducing the "bunny out a hat feeling".

The explanations are very clear and succinct. I'm surprised by the typos concern - a list of corrections are on Veronesi's site, and I can't remember seeing more than two while reading it.

I just taught a course using this book as a guide and I can say it is just what we needed. It lies in between mathematically oriented books such as Brigo-Mercurio and more intuitive approaches such as Hull. It is one of the few books I have seen that does a pretty good job at explaining plain vanilla instruments such as interest rate swaps, caps & floors and swaptions. At the same time the exposition of the various interest rate models and the forward measure is excellent. I do not give it five stars only because at certain points the mathematics is very imprecise and leads to confusion. See for example the treatment of HJM framework when the author uses Stochastic Fubini with very little explanation.
Nonetheless, this is a must have and I am looking forward to edition number two.

This book is full of typos. The author's rounding is off, sometimes he quotes a number from a table, you run your eyes down the table and the number doesn't even exist. While the book came highly recommended, for someone who is trying to learn the subject, it's is painful having to constantly second-guess your reference material.

As a fixed income practitioner, I have long lamented the lack of resources combining academic rigor (like Martellini, Rebonato, etc.) and practical application (Tuckman, Fabozzi eh). The closest book I have found to addressing the challenges of someone working with fixed income in their day-to-day jobs is Tuckman, a reasonably well-written book, although more of a handbook for advanced users than a tutorial to the markets.

Veronesi is possibly the best fixed income introduction ever written. It does not skimp on mathematical thoroughness, as evidenced by crystal clear sections on term structure modeling and continuous time finance, as well as practical examples, including sections on term curve fitting, PCA/regression-based hedging, and well-written case studies throughout.

In short, this has become my favorite reference to the fixed income markets and I highly recommend it to practitioners or even students with some mathematical sophistication and exposure to the markets.

Product Details :
Hardcover: 848 pages
Publisher: Wiley; 1 edition (January 12, 2010)
Language: English
ISBN-10: 0470109106
ISBN-13: 978-0470109106
Product Dimensions: 7.4 x 1.3 x 10.1 inches

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Technical Traders Guide to Computer Analysis of the Futures Markets 1st edition, Charles Lebeau

For those familiar with Charles Le Beau, it will come as no surprise that this volume is full of down to earth practical advice on trading the markets. While the volume is dated by it's misleading title - a large percentage of the information is timeless - even though trading with computers is no longer a novelty worthy of including in the title of a book. Le Beau runs through his approach to the markets, and gives some great fresh ways to use some of the most familiar indicators - ADX, RSI, Percent R, MacD. I'm sure there's something new here for anyone. There's more value in this book than in any webinar which promises you the keys to the kingdom - Well worth the spend.

I thought this book was a great read. It is well written, logical, and methodical. It is a great book for an advanced beginner, or an intermediate trader (like me) who is reading a wide variety of trading books. I liked the messages from the book: think, define problems, find solutions, test, test, and test. I learned some new things that I have not read anywhere else, but the book also goes over subjects already well covered in other books. The book specifies that it targets the futures market, but most material in the book applies to the stock market (which I participate in) as well.

This is a fine book to read, especially if you can buy it used (it is well made with an excellent binding) or find it in a library or at a friend's house. Which brings me to the price: it's a bit steep, the book is not that long, which is why I gave it four stars.

This book really lays it out, indicator by indicator. The authors are real traders with years of experience. LeBeau & Lucas take an in depth look at the most common indicators and oscillators used in the market by professional traders. Yes, there are some dated references to computers and software, the book published in 1992, but they do not diminish the value of the material covered for each technical indicator. I must say that I have truly enjoyed reading this book and it has provided insight to my trading. You will read about real life studies for each indicator and how it performed under different conditions. How to enter and exit a trade, and which indicator is best fitted for which side of the trade. This book is truly a hidden jewel among the clutter of useless hype and false claims on today's bookshelves. I have recommended this book to several of my friends.

I ran across my old copy of Chuck LeBeau's comprehensive guide on tools and indicators that are used to analyze the markets. As I thumbed through this book I was struck by how relevant all of Chuck's work is to today's active trader and investor crowd. So much of what Chuck talks about is still in use today. In fact, even though he wrote the book for Futures traders, those who trade stocks, options and even Forex will find this work to be highly useful. I believe some of it may evolved into Chuck's current project as head of research for Smartstops.net. If you want to find out what indicators are out there and how to use them in order to gain an edge, I highly recommend this book. Most importantly, you'll be able to sift through hundreds of indicators that are, by default, installed on every trading platform and identify just the small handful that will make a difference in your trading or investing.

This book is a must read for Trading System Developers. The concepts can be applied to many markets. The section on testing alone is worth the price of the book.

This book gets a 4 stars rating because of its expensive price (the book is only 220 pages and full of empty spaces). But, price is always subjective. You may treat it as the cost of your education.

Anyway, what makes this book so very valuable is the fact that it is easy to read, clear, definitive, and yes it has so many valuable information on what parameters to use for each indicator. How many of you left confused on what parameters should be used? This book will definitely clear away the clouds in your mind.

LeBeau has done extensive research on indicators such as ADX and his insights on other popular indicators are extremely valuable.

The title may be slightly misleading because bulk of the contents is explaining each technical indicator (120 pages), while only 45 pages on explaining how to build a trading system. Yet, it is clear and concise.

The final Chapter is also valuable. It deals with 12 Day Trading systems that the author has selectively chosen out of all day trading ideas he has or has received from other great traders.

I only discoverd this pretty old book recently. I am suprised to find there are quite a lot of trading tips. What make this book stands out of the crowd is the tips were very concrete and practical. The discussions about exit and stop loss are parcticular good. Many other books just said cut the loses quick. How quick? When? This book gives you some hints. The authors also give some tricks in using indicators which I hope I could know earlier.

I know Charles Lebeau. He does occasional system seminars with my father Dr. Van K. Tharp one of the "Market Wizards" and author of Trade Your Way to Financial Freedom. Charles Lebeau is a great trader. When anyone ask me about a technical indicators book this is the one. Charles is very through. He noticed the best traders in the industry are usually right 30% to 40% of the time. They just cut their losses short and have these huge winners. Charles tested most of the major indicators against random entry i.e. (Flipping a coin) most of them don't do any better. Your exits, psychology, and money management determine if you are making money or not. Don't pay too much attention to your entry. This book explains his results and how to use each indicator. Almost any indicator will work with proper money management. I done well even with flipping a coin and the right stop. The indicator best for you is one you feel comfortable with and will stick with. BUY THIS BOOK and hopefully what I wrote may make some sence to you.

This book is nothing special. I really disagree with the author's interpretation of the ADX indicator. Absolute level is far more important than slope. The day trading systems shown will lead you to the poor house in no time. Presents some novel ideas though.

The book systematically covers technical approach to trading form system building to its testing. Recommended !

Product Details :
Hardcover: 312 pages
Publisher: McGraw-Hill; 1 edition (December 1, 1991)
Language: English
ISBN-10: 1556234686
ISBN-13: 978-1556234682
Product Dimensions: 8.8 x 0.9 x 11.3 inches

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Numerical Methods in Finance and Economics: A MATLAB-Based Introduction Statistics in Practice 2nd editon, Paolo Brandimarte

"Inquisitive statisticians may find this book an interesting read in which to put their theories and epistemology to the test." (Journal of American Statistics, 2008)

"In summary, this book is a "must have" for professionals and researchers who employ numerical methods in economic and financial modeling. The amount and quality of the material that the author offers is so generous that readers are likely to benefit from it even if they are not interested in some of the specific applications presented." (Interfaces, June 2008)

"…a broad and enjoyable introduction to computational finance." (Journal of the American Statistical Association, December 2007)

"...written in such a lucid way that it provides great pleasure in reading...excellent for students...of great value to practitioners who are new to the field." (MAA Reviews, November 23, 2006)

I am using this as a secondary reference for a half-semester Matlab and Optimization course and it has been invaluable. The writing is crystal clear, the examples and code are pretty close to perfect for every section. The author writes in a very intuitive fashion and of the sections I have covered I don't think I have been lost or confused once, which in this field is uncommon.

This is not really an introductory book for finance and if you read the preface, Brandimarte does explain that the book complements and does not replace more specific texts. I have been seen most of the material in this book covered in at least a cursory fashion in my Financial Engineering program and it makes a difference, so I would recommend that you are familiar with the material covered in Hull's "Options, Futures and Other Derivatives" or Neftci's "Principles of Financial Engineering" and Neftci's "Introduction to the Mathematics of Financial Derivatives" or similar texts.

You also won't be able to get away without having at least some intermediate level linear algebra. You don't have know it well but concept such as conditioning, LU and cholesky factorization should ring a bell. On the other hand some topics such as optimization I feel are covered very solidly. I am using "Optimization Methods in Finance" by Cornuejols and Tutuncu and although it is a great book I have to say that the examples in Brandimarte's book are much better and more intuitively explained, although clearly not in the same detail.

My only gripe with the book is that he tends to use code from the toolboxes, which can be inconvenient if you are student and only have the student version at home. Most of the time he builds the code from scratch but he uses toolbox code enough that it is annoying.

I own the first edition, which is half the size of this one. I enjoyed that book, but I had always hoped that it a provide a more in depth analysis. Well it appears my wishes have been answered. Paolo Brandimarte has expanded on his original outstanding work producing a rare book that can be used for self-study and which also provides practical exercises. It really is amazing how he has been able to touch on so many topics without sacrificing content in the process. The writing is lucid and the Matlab examples well-conceived. Anyone desiring to obtain a greater knowledge in the field of finance would be well-served in picking up this fine title. Of course, the book loses much of its impact if the reader does not have a copy of Matlab.

This book certainly is one of THE good books in Finance. I liked the way the author has provided the literature in Finance together with the math behind it. I have been reading other books on the same topic, most of which are crammed with equations without enough details and explanations. This book certainly attempts to fill that gap. (Ignore some of the typos though).

My request to the author...Please write another book, and this time, solely on mathematical Finance and please keep the same style (if not better) than you used in this book. The book (and the author) really helps to not only understand but also enjoy this field by reading books written in such styles.

This is a great book if you want to be a quant or are interested in using mathematical methods for finance purposes. There are not many good books in this field and this one is definitely one of the few good ones out there.

However, this book is not for people with little background in math.

The book earns 4 stars for how it combines what has been out there for some time with Matlab functionality. What one would have appreciated though is something about all the new stuff that has evolved in the last few years (e.g. credit risk, etc.)

Product Details :
Hardcover: 696 pages
Publisher: Wiley-Interscience; 2 edition (October 6, 2006)
Language: English
ISBN-10: 0471745030
ISBN-13: 978-0471745037
Product Dimensions: 6.4 x 1.6 x 9.5 inches

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Mortgage-Backed Securities: Products, Structuring, and Analytical Techniques 2nd edition, Frank J. Fabozzi

Even with the recent events that have occurred in this field, mortgage-backed securities (MBS) continue to comprise one of the largest securities markets in the world. However, since the publication of the first edition of Mortgage-Backed Securities, both the consumer mortgage and MBS sectors have undergone significant changes—many of them resulting directly, and indirectly, from the collapse in mortgage performance that initially appeared in late 2006 and led to the financial crisis of 2007–2008.

That's why the expert author team of Frank Fabozzi, Anand Bhattacharya, and William Berliner—who have witnessed many cycles of change in the mortgage and MBS sectors—have returned to create the Second Edition of Mortgage-Backed Securities. In it, they skillfully reassess the MBS sector in the context of the changes resulting from the crisis, as well as explore the insights gained in the post-crisis period.

Engaging and informative, this updated edition continues to address the investment characteristics, creation, and analysis of mortgage-backed securities, but now does so with the lessons and data accumulated from post-2006 events in mind. Along the way, it offers valuable insights that reflect the current market environment: reexamining prepayment behavior and analysis to describe the latest thinking on prepayment speeds and behavior, while taking into account credit and housing-related factors; and devoting an entirely new chapter to the evaluation of non-agency MBS.

Divided into four comprehensive parts, this reliable resource contains cutting-edge concepts you'll need to understand in order to succeed within this arena.

Part One: introduces the essential aspects of the mortgage and MBS markets

Part Two: discusses prepayment and default behavior, along with an array of metrics and conventions used to quantify these activities

Part Three: describes a variety of structures and tranches, along with techniques used in structuring them

Part Four: outlines the metrics and methodologies necessary to evaluate the potential risks and returns associated with mortgage-backed securities

The mortgage and MBS markets remain in a highly unsettled state, which makes a broad and sophisticated understanding of MBS markets and products essential. The Second Edition of Mortgage-Backed Securities offers you a realistic assessment of this field and will put you in a better position to excel in one of the most dynamic and challenging areas of finance.

Very disappointing. Poorly written starting from the first introductory pages. Be aware of most of the positive reviews, which must have been done by friends of the authors (I guess, since they did not review anything else on amazon). Initial section (on mortgages) is okay, but that part you find it on any financial engineering book. Nothing special or new, except that many concepts and logical connections about why things work in a certain way are already missing. The next sections on structuring are terrible: confusing, and poorly organized (it seems the authors "copied" material without being able to explain things.) If I did not know the subject matter already (a) I would not be able to understand what the book says (some of the very simple concepts are made difficult and complicated for no reason) and (b) I would understand things the wrong way (see the sections on Z-bonds, for instance, IOs, or floaters/inverse floaters), which are all a misleading representation of both market reality and underlying structuring math. Out of curiosity I checked "Wikipedia", which, in a few lines, definitely gave better, more precise and understandable definitions than the ones provides in numerous pages in the book. This book is not worth your money. Another example of a "commercial" textbook, backed by a somewhat famous name, but with no real value.

The guy next to our office was working with AFT/Intex and doing some ABS/MBS modeling. He did some presentation on the subject, but I didn't understood a word he spoke. However, the product looked interesting. So I decided to check it out in this book.

I have to say it is presented very nicely. I only read about 3/4th of the book. I have not used the knowledge for anything yet. So I cannot say how much it has helped me. But the topic is clear and well presented.

Compared to other books and especially handbook of mbs this book has very uniform treatment you don't feel like it is a collection of articles written by different people. The subject is discussed with detail and flow which will allow a person to put it in practice. Have not read the book from cover to cover yet but whatever random parts I read I got answers to questions I had been having for quite sometime.

A well-written, easy-to-follow book that serves as a fantastic addition to any fixed income or real estate curriculum. Those already in or looking to enter the mortgage securitization business should have the information contained in this book as part of their arsenal.

I think this book is the new gold standard for MBS. Unlike previous MBS books I have read, this one flows well from chapter to chapter and can actually walk someone new to the field through collateral, structuring and valuation in a logical manner. Excellent job!

The book provides a very complete overview the residential mortgage-backed securities market and is written by two gentlemen that were arguably at "the center of the storm" at Countrywide Securities.

The book is structured nicely taking the reader from a general overview of the MBS market to a detailed look of the process of securitization through to investing in the end securities.

The chapters dedicated to the structuring and credit enhancement techniques of residential ABS deals a particularly useful to people just entering the current market. The unique perspectives on measuring loan performance and influences on collateral prepayments are also very useful reading.

All in all a must read for those beginning in the industry and a great reference for those of us that might have forgotten a few things.

This book can be used either as a reference for specific technical securities questions or for generic background reading on a related topic. Many people in our office find it very useful and it always seems to disappear from my desk. A must have five star book!

Product Details :
Hardcover: 352 pages
Publisher: Wiley; 2 edition (September 21, 2011)
Language: English
ISBN-10: 1118004698
ISBN-13: 978-1118004692
Product Dimensions: 6.3 x 1.2 x 9.2 inches

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The Failure of Risk Management: Why It's Broken and How to Fix It 1st edition, Douglas W. Hubbard

"…shows how to identify and fix hidden problems in risk management. He uses real world examples to reveal serious problems in common quantitative and qualitiative approaches to risk analysis."

This book is a must for every professional, undergraduate, graduate or post-graduate student dealing with risk management. Douglas Hubbard manages to combine proper mathematics with the basics of measurement and still keeping things within reach of an audience that does not necessarily has to have too much mathematical skills. Speaking of experience, I started as a PhD in Physics using Monte Carlo for simulating Magnetic forces in semiconductor interfaces. Then I transposed these methods more than 20 years ago to medical equipment, did some work in safety, environment, food hygiene and finally ended up in innovation and entrepreneurship. All of these tracks have an intensive relation with risk. I saw many of the errors (and even more) in risk management as (nearly literally) described in this book. So the level of relevance is there.

The treatment in three parts is well done, the structure is both professional and inviting to read more. The skill Douglas Hubbard apparently has in combining almost prosaic phrases with good scientific content, makes this book to be a reference book and a novel at the same time. An example for many of us (including me) that do not have this skill. I applied already formerly likewise approaches but with the reading of the book, I succeeded in leaving some very heavy (and expensive) calculation programs for the marvelous and illicit Excel sheets Douglas is posting on his website, at least for some applications. As a tutor I take the book of Douglas and leave the "heavy programs" for later on. This "step up" is amazing for students as they get gradually into the complexity of the matter.

I read some of the negative critics and think some of the people did not read the book properly. Of course when you are used to make large qualitative studies, I can imagine this book is at least a bit "annoying". But as I will always remember the quote of one of the Top Risk assessors and managers of Philips Medical Systems in Holland, "measurement is knowledge and when someone pretends to have a better risk assessment and/or risk management, let him prove to effectively be better". I love the way Douglas Hubbard takes these principles in to real life practice. I applied the risk approach as described in the book already many times and it does work amazingly well.

I strongly recommend this book to professional, tutors and students (getting) involved in risk (as well the risk assessment as the risk management). It can be applied to several domains of risk such as but not limited to: clinical trial, environmental risk, general business risk, safety of products risk, risk of medical equipment, food-safety risk, innovation & entrepreneurial risk (business plan or business case risk). That's were I already applied it with success.

Prof. Dr. Johan Braet, Antwerp University, Faculty of Applied Economics, Department of Environment and Technology, Innovation Management & Entrepreneurship, Risk Assessment (LCA) & Risk Management

I have been involved in business consulting, investment management, business valuation and corporate governance for most of the past 25 years, and I can say without hesitation that Doug Hubbard's book on The Failure of Risk Management is an outstanding and elucidating work. I have never been a risk manager per se, but I have frequently been deeply involved in risk assessment and risk management activities, so I do have firsthand experience in this topic.

This book is an eye opener from the outset. In Part One of his book ("An Introduction to the Crisis") Hubbard begins with fundamental, obvious questions about risk management that everyone (not just risk managers!) should be asking. For example: How do you know that your risk management program is effective? Would anyone in your organization know if your risk management program didn't work? (...and how would they know - and define - that it wasn't working?). These are very simple, obvious questions, yet I have never heard them asked by management teams or even members of boards where I have served as director. Alas, there is a huge "placebo effect" in so much of what passes for risk management nowadays - perhaps that is why it is so popular.

For example, consider the following: If risk management programs really do work, then it seems logical to assume that companies in a given industry with a (self proclaimed) "highly effective" risk management program would show greater shareholder returns, less earnings volatility, and better safety and regulatory compliance records than other companies in their peer group who lack such a program. Yet there appears to be no valid evidence that current risk management practices, taken as a whole, serve to improve overall corporate performance. The evidence just isn't there.

In Part Two ("Why It's Broken"), Hubbard provides a thorough and convincing overview of the many shortcomings of modern risk management practices. As a self proclaimed "Quant," he strongly endorse quantitative analytics as the most effective approach to both measuring risk as well as the implementation of risk management programs. His approach is compelling and convincing; after all, if we can't measure accurately, how can we rely on our system of "assessing" (i.e., measuring)? It sounds pretty obvious, doesn't it? Without metrics, what tools do we have, other than generalizations, hunches, intuition, and "gut feel"? Sure, certain qualitative techniques are helpful, but qualitative risk analytics is really effective (in my view) only for the most obvious risks, and therefore no better than having no risk management program at all. Indeed, Hubbard makes a compelling argument that ineffective risk management can be worse - possibly much worse - than having no risk management program at all.

Part Two also includes concepts that Hubbard brilliantly applies to risk management practices. This includes certain characteristics of human nature, such as a proven tendency to be overconfident in our estimates (of risk, but also of other estimates), that must be acknowledged and addressed in order for risk management programs to work effectively. He also provides a practical method of adjusting or "calibrating" for such overconfidence. Similarly, there is a fascinating discussion on risk correlations and how risk events seldom materialize in isolation from one another. Consider (my own example) certain risk correlations in mortgage banking. Banks that invested in mortgage backed securities no doubt undertook some sort of risk analysis of these investments. They also had risk management systems in place for their mortgage lending business. But how many lenders tied these two risk programs together, and properly concluded that a collapse of one market would also result in the collapse of the other? Thus, it's not just a case of accurately assessing and management individual risks, but also in considering the extent to which there might be a "domino" or "cascading" effect among different risk factors.

In reading Part Two (especially Chapters 6 and 9), it occurred to me that this book should be read by anyone and everyone involved in investing or lending money.

As one might expect, Part Three of Hubbard's book ("How to Fix It") embraces a scientific and quantitative approach to improving risk management. Once you get to this point in the book, you will find it very difficult to disagree. Another important concept introduced by Hubbard is that of language and communication with respect to risk. As a potentially murky and subjective topic (if not downright Byzantine at times) risk management systems require clear and concise language and terminology to be effective. Thus, if two different managers in the same factory concur that the likelihood of a risk event materializing is "very likely," we should not assume that they both agree on the use of the term "very likely." One may feel that this means the odds are one in three, while the other feels the odds are one in ten.

Hubbard is clearly on target when he proposes that risk managers apply scientific methods to risk management. His suggestions on how to do this are fairly simple and practical. Without such methodologies, risk managers are sailing through dense fog with an unreliable compass. You might even feel that you are making great headway, but if you can't measure where you are going, you will never know if you are really making any progress.

Finally, one of the greatest benefits to me in reading this book has less to do with the specifics of risk management and a lot more to do with the way people think. Consider, for example, why your sales team frequently falls short of their sales projections, or why so many portfolio managers buy stocks near their highs and sell near their lows. Or why risk management programs are so popular, and yet seldom work. Hubbard provides a brilliant and penetrating look into the human mind in the context of business decision making as a whole - not just with respect to risk. For me, this was an excellent "upside surprise" to this book. I finished reading this book several months ago, and I still think about it all the time. It has made a lasting and beneficial impression that I will never forget.

How do we know if our risk management methods are working? Would we notice if they were not working? What are the consequences if they are not working? These are the three basic questions that Douglas Hubbard asks in his book The Failure of Risk Management.

In this book Mr. Hubbard lays out the basics of risk management and explains why many risk management methods are worse than useless. He also provides some ideas and first steps to fix the problem.

Here's a brief walk though 'The Failure of Risk Management':

Part I introduces the history of risk management and the problems with modern risk management methods. Independent events, for instance, are often times not independent at all. This common-mode failure is unaccounted for by many managers, yet can be devastating in an emergency.

Part II of the book goes in depth with some of the problems and failures of risk management, and to me was the most interesting part of the book. Chapter 4 is called The "Four Horseman" of Risk Management, and describes the differences between what the author considers the four main classes of risk managers. The four classes are actuaries, "war quants," economists, and management consultants. Each group has distinctly different methods and areas of expertise, as well as different levels of validation.

Chapter 5 is about how risk should be defined, and why different people may actually be talking about different things when they discuss volatility and risk. Chapter 6 breaks down why humans are not good at subjective methods (which lays the ground work for later chapters introducing quantitative methods). There are a few "calibration" tests available for you to see how overconfident you are in your decision making. These are pretty interesting, and even after reading about overconfidence I still did poorly on them.

Chapters 7, 8, and 9 talk about problems with subjective scoring methods, problems with describing one-off events, and the problems with some quantitative models. The author talks about "black swans," as described by Nassim Nicholas Taleb, and how they relate to modeling. Many times people believe that events can't be modeled, but the author believes this is not so.

The last section of the book, Part III, gives some ideas on how to fix risk management. Adding empiricism is a big start, as well as calibration of subjective human inputs. Many companies build and use models, but then they don't actually bother to see how well the things have performed in the past. I will leave the rest of the solutions for you to read in the book.

Recommendation:

First off, the author says this book is geared towards all types of risk management, and all types of industries, and I think this is true. The author uses a wide variety of examples from airplane engine failures to volcano eruptions. But I still feel like this book is more geared towards enterprise risk management, and less towards the already quant heavy fields such as actuarial science or credit risk management. But it was an interesting read nonetheless.

It seems like in the past 20 years there have been several so-called "once-in-a-lifetime events," such as the floods of Hurricane Katrina or any of the financial crisis, including 1987, 1998, 2000, or 2008. I wish I had the money to buy this book for every person who ever said "no one saw that coming."

I think this is a great book for anyone who deals with the potential for risk, loss, or damage - no matter if it is financial, personal, or physical. When the stakes are high we should be careful relying on a risk matrix developed by a management consultant, and Douglas Hubbard will tell you why. If you work in risk management, or if you have influence on the operational strategy of some organization, then this book is a must read.

Product Details :
Hardcover: 304 pages
Publisher: Wiley; 1 edition (April 27, 2009)
Language: English
ISBN-10: 0470387955
ISBN-13: 978-0470387955
Product Dimensions: 6.4 x 1 x 9.4 inches

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Derivatives Markets 2nd Edition, Robert L. McDonald

I was assigned this text for a course. Since it was an intro course the instructor really didn't use the book as intended, though I was assured they did at the graduate level.

This is a great intro book. However, as with all books on derivatives and fianancial engineering, you have to have the math foundation.

Again, people do not realize that derivatives and fianancial engineering use very sophisticated math. Which is why wall street finds it easier to hire math guru's like electrical engineers and physics people and teach them fianance than it is to hire fianance majors and teach them the math.

It has gotten better since universities have dedicated graduate programs. And textbooks like this are as soft of an intro as you will find.

I found the coverage of topics excellent. From options to swaps, from stocks to currencies.. and every strategy. the author does not miss anything.

It is not an easy subject matter, but the author does a great job of introducing it.

I was little skeptical when I placed an order for book that was in backlog order. But to my surprise, I got the book very fast in just 2 days, kudos to Amazon.

It has important facts that I needed to learn for the Actuary Exam FM.
Unfortunately, I find textbooks to be tedious, and it does not provide the answers to the questions at the end of the chapters.

I bought this book to teach myself more about financial markets after the meltdown of 20xx (insert any number between 08 and 11).

This book is a great first book on financial markets. The assumed knowledge is minimal: at best, the first few chapters assume that you understand how simple interest work. All the concepts are explained in great detail, with many examples, and the various positions that players on the market can assume are explained very clearly.

The later chapters assume marginally more mathematics, but not much more than most college graduates with some courses on calculus can handle.

Over all, this book competes with the book by Hull for being a great introduction to ingredients of the financial markets.

For those studying for the Actuary Exam MFE, this is a decent textbook to refer back to. I am also using Weishaus's Exam MFE study manual. It's nice to read the textbook and get the background for what is basically just included as Cliff's notes in Weishaus's study manual. The two paired together provides a comprehensive background for the material.

I used this book in an actuarial Exam FM/2 prep course at my university. We only covered the material through swaps (i believe chapter 8). Easily understandable. I had trouble understanding the swaps portion of the text. Definitely a more valuable source if accompanied with instruction. Tons of information... no information on directional trading and prediction of market movements, but that is not what the book was intended for.

This book is actually quite weak. While, the other books recommended by Actuarial Societies are quite strong, this one does not hold up. There are not enough examples or problems in the book. In addition, the book continually reuses the same information in its examples requiring less thought to get through them.
My biggest complaint is how the book approaches Put-Call Parity. This book offers the worst explanation for that concept I have ever read, which is sad because it is the basis for pricing calls and puts.

This seems to be the book chosen by most instructors so there must be some reason for assigning it. I am familiar with the material from reading corporate finance texts. This text, however, is not written well and is actually confusing. So one struggles to understand what the author is actually saying. Hope it gets better.

This is a great book. Not only was it very useful in my derivatives class, it also was useful for other finance subjects. I often found its explanations helpful for completing assignments in fixed income and international finance courses. McDonald's clear explanations and explicit examples set this book apart from others.

Very easy to understand. IMO, it is the only book that is at par with, if not better than, John C. Hull's "Options, Futures And Other Derivatives."

Strongly recommended for everyone with even an oblique interest in the study of derivatives.

If Shreve and Karatzas is/are too dense, read this instead.

With all due respect, this book should inspire the Broadies and Dermans of the world to write such textbooks themselves, and the Sundaresans and Glassermans of the world to (also) cater to less scholarly minds (such as the undersigned).

I got this book few months back, though little pricy but someone recommended it. I found it to be a wonderful blend of the economics and mathematics of derivatives pricing. After reading the book, i was comfortable with :
understanding of derivatives pricing models &
derivatives markets

I strongly recommend people giving their FRM, CFA and / or SOA certifications to get their hands on this book.

You would like it. A good reference book. Only issue is it is little too heavy, hence you cannot lie down and read it for a long time.

I was recommended this text book by the study material I was using to prepare the acturial exam FM. Then I came to check this book here and I found out that the price here is way too much higher. With this price, you can buy both the text book and its solution mannual in Actex Mad River with free UPS shipping. Hope this will help.

Product Details :
Hardcover: 912 pages
Publisher: Addison Wesley; 2 edition (December 25, 2005)
Language: English
ISBN-10: 032128030X
ISBN-13: 978-0321280305
Product Dimensions: 7.7 x 1.4 x 9.4 inches

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The New Sell and Sell Short: How To Take Profits, Cut Losses, and Benefit From Price Declines Wiley Trading 2nd edition, Alexander Elder

THE NEW SELL & SELL SHORT EXPANDED SECOND EDITION

Any beginner in the stock market knows how to buy. Knowing when to sell will setyou above the crowd. This book will teach you when to sell and how to sell short.Stocks go down much faster than they rise, and knowing how to short doubles youropportunities. Amateurs don't know how to short and are afraid of it, but professionals love to profit from declines.

This new and expanded edition includes an intensive study of the 2007–2009 bear market, with many specific trading examples, distilling the essential lessons of recent years.

"Elder clearly shows how to take profits on winning trades or cut losing trades. He skillfullycombines technical analysis with trading psychology and risk management. Elder lets you in on a favorite game of market professionals — shorting overvalued stocks. His trading lessons from the recent crash are valuable and practical."
—John J. Murphy, author of Technical Analysis of the Financial Markets

"The New Sell & Sell Short delivers practical techniques for selling and shorting. In his relaxed style, colored with humor, Alex details strategies for limiting risk and protecting profits. My favorite is what he calls 'engine noise,' illustrated in a great study of Ford. His chapters on shorting tops and downtrends make difficult tasks accessible to all. This is an indispensable book for investors and speculators alike."
—David Weis, trader and author of Trades about to Happen

"Dr. Alexander Elder is one of the world's most respected teachers of trading mastery. I've read hundreds of books on trading and consider his writings to be among the mostvaluable and useful. Traders who do not know when to sell or how to profit from price declines keep missing major opportunities and expose themselves to unnecessary risks. The New Sell & Sell Short should be required reading for any serious trader or investor."
—Ed Dobson, founder of Traders Press Inc. and a private, full-time trader

I am glad that Dr. Elder took the time to update and publish this book in a new edition. He saw the warning signs of the 2007 bull market coming to an end and had the foresight to write a book about the importance of timing exits and the value of shorting stocks when the time was right. It appears that the author is also as good with his entries and exits in publishing as he is in trading. He could not have given the trading community a better book at a better time when it was first published in May 2008.

If you are searching around on Amazon for a book on trading stocks then look no further, you have found one of the best ones on the market. I have actively traded successfully for over 12 years and read over 160 trading books, this stands out as one of the best. The book is a complete book on trading, it does not skip over any of the most important areas a trader will need for long time success in the markets.

1. The trader must have a trading plan, even discretionary traders.
2. The trader must keep good records to understand his mistakes and successes.
3. A trader should not trade so big that it causes excessive stress and bad judgment.
4. A good rule is to cut every loss to a maximum of 2% or less to limit the risk of ruin.
5. Trading with discipline will put you ahead of the majority of traders.
6. Your trading must fit your own personality and risk tolerance.
7. If you use fundamental ideas for a trade cross check it with the technicals of the chart.
8. Stock option buyers are net losers in the market.
9. Traders can not give up on a stock because they are stopped out, successful traders keep trading the stock until they catch the winning trades.
10. False breakouts and rallies off support are two of the best trading opportunities.

The trading style of the book's author is to trade with a fast and slow exponential moving averages (13,26), along with envelopes. He explains how to use short term swing trades using the MACD and force index to trade when a stock is technically above or below its value zone. The style is not to catch huge trends, it is just to have winning high probability trades by catching half or more of the stocks average range. This is the way professionals trade in a normal market environment. Risk management using stops will protect you from any trend that does take off and falls outside the normal range.

While as the title suggests it teaches when to sell your stocks for profits, and also does the best job I have seen of explaining short selling and when technical indicators show to short. This book is a complete book for any trader. The main lessons of this book is when to lock in profits and exit a trade using a target, and how to double your potential for profits by not only buying stocks but also selling stocks short and buying them back at a lower price for profit.

Professionals sell short because while overall the stock market drifts upward, when a stock falls it falls over twice as fast as it rises. I sell short and it is a powerful tool when used correctly. This book will show you when it is appropriate to short.

Dr. Alexander Elder is the only author I am aware of that integrates trading psychology, money management,technical analysis, and record keeping into one book. These four factors will determine whether you are successful in the market or not, even more than the trading method you choose.

If you are going to be a trader you must follow the money management suggestions in this book. NEVER risk more than 2% of your total equity on a trade, If you follow the 2% rule from the book, it will save you from learning this major life lesson the hard way and save you from huge equity draw downs.

Your long term success as a trader is determined by your ability to learn from your mistakes and not repeat them. The best way to do this is to keep detailed records on a spreadsheet and charts of each trade and a diary of why you traded. You must look squarely at each loss and win. If you learn from each bad trade and limit your loss to less than 2%, it can turn into a long term positive.

This review only scratches the surface of this great book. It is packed with very helpful principles, real trades, humor, and is just outstanding. I really grew as a trader years ago from reading and implementing Dr. Elder's best selling classics "Come into my Trading Room" and "Trading for a Living". If your dream is to trade for a living some day or just trade successfully this is the book to buy.

I was also very glad that Dr. Elder added in trades from the bear market of 2008-2009. I found his explanation of his trades very interesting and informative. There were reviews of some charts from that time period that showed signals of the bottom and when it was time to quit selling and selling short and start buying again.

I have read Dr.Alexander Elder's every single trading book, few of them Re-read again and again.And trust me, this book is one of such rare breed of books. With his previous books, the message was so influential, that I joined "Spike Trade" for few months. You might have guessed, Yes, I am little biased,but this review is purely based on the quality of the book.

MIND IS NEVER COLOR BLIND:
Before I get into the content of the book, I wish every author who writes a book on stock market (with Charts) should realize color helps understand the message the author wants to convey. Tons of charts in the book alone are worth more than the price of the book. I have read several books on stock markets,but they all miss the visual appeal of descriptive charts. They have some black and white charts with few lines and no descriptions on the charts itself.

NEWBIES - AMATEURS - SEMIPROFESSIONALS:
First of all , this book should not be your starting point for Alexander Elder's books. For Newbies the suggested order...

1. Trading for a Living: Psychology, Trading Tactics, Money Management ( You will need to read it twice)
2. Start making journals and learn from your trading experiences
3. Come Into My Trading Room: A Complete Guide to Trading (Masterpiece...Read 4 or 5 times to absorb the spirit and content of the book.)
4. Entries & Exits: Visits to 16 Trading Rooms (Wiley Trading) (Read once)
5. The New Sell and Sell Short (Wiley Trading) (Read couple of times)
7. Understand Metastock, Tradestation, esignal type tools.
8. Attend his seminar if you can afford.

LATE STAGE AMATEURS - EARLY STAGE SEMI PROFESSIONALS :
If you have read the above books and show fairly consistent equity curve , how will this book help? . It is a great refresher.

> How Confident are you identifying bullish or bearish Divergence?
> How often have they turned out to be correct?
> Do you still have spreadsheet and mental notes separately?
> Do you review them?
> What have you done to become a better trader?
> How many times have your stops been hit? Why?
> How many times did you get out late / Early .. Why?
> Do you compress the entire life of the charts to see how the stock is doing compared to it's historic averages?

Elder's books were the single largest reason for me not getting wiped out in the stock market. But this book brought me back to the reality that getting past amateur to semi professional is not an easy breeze.I have to be more honest with myself in making the notes, reading it and so on.

EXERCISES:
The exercises are boring; but so is serious trading . Please take time to do the exercises sincerely. Assuming you read the book and took the tests sincerely, you can skip the tests when you read it second or third time ( highly recommended)

GOLD STANDARDS:
The next few lines of this review , if you read and follow will have far more impact on your trading career than any individual book. For beginners/Semi Professionals/part time traders . Similar to "Driver License" being mandatory to Drive, I wish the following books below are mandatory requirements before anyone opens an online account. The books listed below are "gems" if you are not a "buy and hold" investor.

Alexander Elder focuses most of his attention on selling and shorting equity instruments, not on buying them. The author does not provide an in-depth examination of trading in futures, options, and forex. Elder explains to his audience mostly the ins and outs of short-term trade. However, readers do not have to be short-term traders to benefit from the book under review.

Elder firmly believes that successful trading results from the combination of what he calls the 3 Ms: Mind (i.e., trading psychology), Methods (i.e., indicators and tools), and Money (i.e., risk control). Elder emphasizes repeatedly the importance of keeping good records for each trade to become a successful trader. Clarity and discipline are the pillars on which successful trading rests. The author provides a template to be used for documentation purposes.

In his trading examples, Elder helps his audience interpret charts and leverage mostly his favorite indicators: moving averages, envelopes, also called channels, MACD, and the Force Index. Readers who have no prior familiarity with these indicators are advised to gather first information on this subject before going through Elder's guide to trading.

Elder gives his audience the opportunity to put theory into practice through a 100+ questions about 1) psychology, risk management, and record-keeping, 2) how to sell, and 3) how to sell short. Answering first the questions before turning to the answers section is key to testing one's knowledge about these topics.

Finally, Elders completes his examination of the new sell and sell short by reviewing the lessons to be drawn from the current bear market rally.

In summary, Elder gives his audience a great opportunity about how to learn to combine the 3 Ms mentioned above with success. The author reminds his audience repeatedly that only a minority of traders systematically make money in financial markets over time.

Product Details :
Paperback: 368 pages
Publisher: Wiley; 2 edition (March 29, 2011)
Language: English
ISBN-10: 0470632399
ISBN-13: 978-0470632390
Product Dimensions: 6.1 x 0.8 x 9 inches

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Trade Like an O'Neil Disciple: How We Made 18,000% in the Stock Market Wiley Trading 1st edition, Gil Morales

How is it that so many traders and investors lose money in the market, while others—like authors Gil Morales and Chris Kacher—have shown the ability to earn huge returns on investment? As Bill O'Neil himself says, "Human nature being what it is, 90% of the people in the stock market—professionals and amateurs alike—simply haven't done enough homework." Trade Like an O'Neil Disciple: How We Made 18,000% in the Stock Market is your homework. And if you invest in the market, you can expect that there will be a test involving your own money.

The result of years of observation and the subsequent application of the commonsense rules learned, Trade Like an O'Neil Disciple details the small realities that make up the stock market, including:

The importance of a 6–7% automatic stop-loss policy on stock purchases

Sit tight and be right, or "take your profits slowly"

The value of psychological capital, and how mastering your own psychology allows you to operate from a position of strength

Position concentration, and how diversification—"kissing all the babies"—is unnecessary

How timing the market is possible and necessary, despite claims to the contrary by those who can't

Mistakes novices or lazy investors make, such as averaging down or purchasing only cheap stocks

How O'Neil applied historical precedent to box theory to come up with consolidation patterns ("bases"), such as: ascending; cup-with-handle; double-bottom; square box; flat base; and high, tight flag

Using early buy points in the form of "pocket pivots" to gain an advantage in difficult market environments

Using gap ups as buy points to jump on board of some of the most powerful stocks

The finer points of O'Neil-style short-selling techniques

It took years to identify, analyze, catalog, and verify the characteristics of winning stocks for O'Neil to finally perfect his system. Authors Gil Morales and Chris Kacher save you the time and—if you're an investor, money—by bringing together in one comprehensive guide, the commonsense investment philosophies that allow them and you to Trade Like an O'Neil Disciple.

This book is an excellent addition to the CANSLIM literature. To understand this book's place in the grand scheme of trading literature, I have to digress first.

If you have been trading for a few years and have read some of the classic literature on trading (e.g., Market Wizards series), you know that the vast majority of successful traders are trend followers. The objective of trend followers is to capture trends in markets with limited risk. The rules of trading that all trend followers stick to are letting profit run, cutting losses short, and manage risk.

O'Neil is in his core a trend follower. He suggests cutting losses at 7-8% or less. Once he latches onto a big trend, he sits tight with the trend until the trend runs its full course (e.g., his trades in Chrysler, Syntex, Pic `N Save, Amgen, Charles Schwab, AOL, Sun Microsystems, EBAY, and more recently in AAPL). O'Neil also manages risk of his trades by rigorous stock selection, broad market timing, and position sizing.

How good is O'Neil? According to some accounts, O'Neil has an average annul return of over 40% for nearly half a century (1962 - present). That's better than anyone else with such a long-term track record. His numbers are better than those of Warren Buffet's, Peter Lynch's, and even George Soros'. Some have argued that given O'Neil's great rate of return over such a long period, why then isn't he as rich as Buffet or Soros? The answers are: 1. Although O'Neil is indeed very rich (2 Billion plus according to some accounts), O'Neil doesn't put all his capital in the market. 2. O'Neil doesn't trade other people's money, thus he doesn't have the leverage that Buffet and Soros have had. 3. O'Neil started with five thousand dollars, while most other big guns started with a lot more money, either theirs, or other people's money. 4. O'Neil's trading style doesn't allow him to trade multi-billion dollars - imagine selling 1 millions shares of a small stock at the market when your stop loss is hit! So, for whatever reasons, O'Neil is not as rich as Buffet or Soros on paper. But what the dickens does that matter to you? If you are reading this review, chances are you are a small fish, most of you may just want to make a little extra money to supplement your regular salary, some more ambitious may want to make enough money consistently in the market so that you can "trade for a living", and still a few, like myself, strive to "make millions" - So, the fact O'Neil is not as rich as Buffet or Soros shouldn't bother you. Because in your and my league, that is, the league of traders who manage the amount of money ranges from thousands to a few hundred millions, the best long-standing player is William O'Neil.

In stock trading, the most reliable and confirming indicator suggesting lasting power of a leading stock with superior relative strength is that in its same industry group, there are one or more other leading stocks demonstrating similar superior relative strength (remember DRYS, TBSI, and TNH all moved at the same time, then POT, MOS, CF, TRA all moved at the same time, then FSLR, SPWRA, TSL, STP, CSIQ all moved at the same time?). Thus, using this analogy, if a host of traders out of the same group (O'Neil's group, in the broader sense, the trend-following crowd), using largely similar strategies, all achieved superior results, then there must be something special about this group. The only difference is that all the leading stocks will finally top out and become the best shorts while the best traders get better and spawn another crop of superior traders.

Take a look at this long list of some of the best traders spawned by O'Neil's teaching: David Ryan (of Market Wizards fame, 1985, 1986, and 1987 US Investment Champion, with performance numbers of 161%, 160%, and 118% for those 3 years, respectively), Cedd Moses (1991 US Investing Champion, 379%), and Lee Freestone (1991 US Investing Championship, second place, 279%, 1992 US Investing Championship, second place again, 120%, and 1994 US Investing Champion - first place finally, 234%). Rumor has it that Mark Minervini (of Stock Market Wizards fame) also worked for or was [more likely] heavily influenced by O'Neil and David Ryan. According to Jack Schwager, Minervini's average annual compounded return between 1995 and 1999 was 220 percent, including his 155% first place finish in the 1997 US Investing Championship.

Kacher and Morales, the authors of this book, are two more recent outstanding students of O'Neil's. Kacher's performance numbers: from 1996 to 2002, 110% per year for 7 years (could have been much higher had he decided to fully use his available capital, also remember he has included in the two and half years of the great bear market at the beginning of this century). Jil Morales' performance numbers: from 1998 to 2005: 80% per year for 8 years (excellent numbers given that a large chunk of this timeframe falls right into a once-in-a-life time bear market).

So, Kacher and Morales' numbers speak for themselves - they are among the best. They are like the leading stocks from the No 1 industry group! So, their book is a must "long" for any serious trader.

That's why I had placed a pre-order several months ago before the book was published and as soon as pre-orders became being allowed. So far, I have gone through the book only twice, and already liked it. The meat of the book, in my opinion, is Chapter 5 and Chapter 7. Chapter 7 discusses the Dr K's Market Direction Model, which is Kacher's formalization and refinement of O'Neil's concepts of using follow-through days to identify general market (a.k.a, broad market indices, such as the Nasdaq Composite and the S&P 500) bottoms and using cluster of distribution days to identify general market tops. Chapter 5 discusses entry points that are different from, and supplementary to, the classic O'Neil new high breakout of the nine or so O'Neil patterns (e.g., cup and handle, double bottom, flat base, and others). I don't know if these newly introduced "pocket pivot" are indeed very efficacious patterns with superior Risk/Reward ratio and reasonable reliability - but the concept is certainly interesting and one should check them out and back-test them thoroughly before applying these new concepts to his/her own trading. I find the buying-gap-ups entry more useful but once again I need to do more research myself before I can decide if or how I should incorporate it into my trading. I personally find the Dr K's Market Direction Model chapter most interesting, because I have been trying to do the same thing in the past few years. So, this chapter, plus Chapter 2, which Kacher describes how he made 180 times of his capital in 7 years using this model and individual stocks selection, will be most helpful to my evolution as a trader. Given any kind of decent seminar nowadays costs the trader thousands of dollars and more, and any mistakes in the market cost even more, I'd say the book is worth many times over its nominal price.

Of course, the book is not perfect; nothing about the market is perfect because the market is not perfect. I agree with the previous reviewer's (Chandra Sekhar) comment that the writing can be improved. There are some inconsistencies of thoughts. For example, at the beginning of Chapter 7, page 226, the authors say that "while a market direction model may seem like a `timing model', we do not ascribe that term to it, since it does not adequately describe our approach in using such a model. A market direction model, in contrast to a timing model, should be... ". I bet anyone who is reading this would assume that the authors meant to say that market direction model is not equal to market timing model, however, the terms "market direction model" and "timing model" are used interchangeably throughout this Chapter and especially in Chapter 2, where the author would say "my timing model sheds much light on the character of the market" on one page (Page 35), and then one page later say "My market direction model is almost always on a buy signal during such times (Page 37). So, after having perused the relevant sections 3 or 4 times, I still don't know what the difference between "Market Direction Model" and "Timing Model" is. Overall after reading the book, I think they are the same, but the author seems to have especially pointed out they are not identical - I am still confused.

Also, I wish that Kacher could have been more transparent and been less ambiguous about the rules and construction of his market direction model. But I assume that this model is proprietary and its full construction is not intended to be fully disclosed to the public.

In addition, as the previous reviewer (Chandra Sekhar) hinted, Morales' trading of CUBE using a shipload of call options is not something that the readers of this book should aspire to. One of the most confusing aspects of the market is that in it, there are good trades, there are bad trades, there are wining trades, and there are losing trades. And they are not the same thing. A winning trade could be a bad trade. And in the case of Morales's hugely winning 1995 CUBE call options trade that increased his capital by 500% (not 1000% as the previous reviewer said) it was actually a bad trade. Why, because Morales could have lost all his money and would never be able to trade again. So from a long-term survival point of view, this trade is a bad trade, because he obviously overtraded, meaning, had he repeatedly position-sized like that(seems that he betted all his trading capital on that trade), very soon, he would have been wrong and could have lost everything. However, I am glad that Morales survived a potential disaster (partially based on skills, but largely due to luck), developed himself into a more disciplined trader (otherwise either his numbers would be astronomical or he wouldn't be here), and now can share with us his trading experience and techniques.

So, despite the minor flaws mentioned above, all in all it is an excellent book. The book will help traders in general understand how other traders achieve their super performance and help CANSLIM traders in particular gain a deeper understanding of the O'Neil strategy. The authors share with us some techniques that they developed. By going through all the trading examples and trying to grasp the thought processes behind their writing and their trading examples, I've confirmed and validated some ideas that I independently came up with (e.g., there must be more ways to get into a trend than just O'Neil style base breakouts and 50-day MA entry), which are somewhat similar to the authors'. While the various gems throughout the text are valuable, the opportunities this book lends to confirming one's own ideas with the ideas of some of the world's top CANSLIM traders is invaluable.

Product Details :
Hardcover: 384 pages
Publisher: Wiley; 1 edition (August 23, 2010)
Language: English
ISBN-10: 0470616539
ISBN-13: 978-0470616536
Product Dimensions: 6.5 x 1.2 x 9.4 inches

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Multinational Financial Management 9th edition, Alan C. Shapiro

This is a nice book for the medium-advanced student in finance - and definitely a good refresher for the practitioners of the international corporate finance. As other reviewers mentioned, might be a bit too shallow, but the number and the substance of the study cases helps for sure. A "should have" for the finance managers in multinationals. For more details you can read the review on the investing blog at doitinvest.

This is a good book and very useful for those who work in finance or management in a multinational environment.

The book was in excellent condition. I bought it brand new. It was packaged in a way so as to keep it looking new. This book was prescribed and part of the course I took in MBA program. Love the book, its very interesting.

I used this book for the first and last time in Autumn term 2006 with 28 foreign students in my Global Finance MBA course. When one wishes to make money by consistently reissuing new editions he has an obligation to update it at least minimally, (The Paul Samuelson Rule). In this case Greed is not good.

Hence, my exasperation when I open the 2006 edition of the book and on the first page learn that the currency of Belgium is the Belgian franc, the currency of Ireland is the pound,(Ireland's curency was never the pound; it was the punt) or that Germany still has the DM. Many of students lost points on a midterm because they thought the currency of Finland is is the markka. Shapiro in 2006 says so. On the next page he fails to mention Monaco; there are a lot of capital flows internationally through Monoco. And on that page Spain still has a peseta.Portugal has escudos.

The book also suffers from wordiness. I did like the key phrases section in each chapter; I thought at least that all key phrases would be included in the glossary but I could find all there. There is a certain obtuseness which I did find perplexed my students sometimes, who did not quite enjoy this book as I had hoped. We would not use it again.

I tried to contact the author by email with several queries but did not experience the courtesy of a reply.

This is one of the better books for a course in international finance. It has cases in the text, which allows the student to get the real world intuition of the topics that are being covered. This is not a text that only extends capital budgeting to an international setting, it also includes some concepts borrowed from international economics (e.g. purchasing power parity, interest rate parity, covered interest arbitrage, etc.). It also looks into some risk management practices that are relevant for multinational corporations. However, I feel that some topics could have been cut short and the author just wanted to add a few (hundred) more pages to the text.

The book "Multinational Financial Management" is a good introduction to this rather complex subject. It is written well and contains a lot of examples and historical references. Some of the chapters in the second part are kept a tad too short though.

The book covers the main topics of international financial management, the environment of international financial management, foreign exchange and derivatives market and risk management, financing of multinational corporations, foreign investment analysis and multinational working capital management in 5 main sections.

I found most parts of the text to be very well readable and easy to understand. All concepts are backed up by examples and separate illustrations discussing a real event in more or less detail. This works especially well in the first chapters of the text covering the simpler concepts. Subjects like international monetary systems or country risk analysis (to just mention a few) are covered in great detail, and the required math, e.g. the formulas used for the parity conditions and the Fisher Effect, are illustrated with enough examples even for someone with little or no mathematical background.

The parts of the book covering derivatives is too short and the theory provided does not go deep enough in order to comprehend the more complex examples easily. Trying to figure out the mechanics of Kodak's Zero Coupon Australian Dollar Interest Rate/Currency Swap involving 11 parties, multiple swaps and currencies was no easy task after a mere 2 1/2 page theoretical introduction to currency swaps. There are better books for understanding currency swaps.

Other parts not covered deep enough were the chapters on international project and firm evaluation (covering subject like WACC and CAPM). With just this book, it is impossible to get an idea of the real meaning of these models and techniques. Too many details are omitted that should have been covered. Granted, these are more complex subjects, but maybe the author should have either keep the book focused on the main topics or split the content over two books.

Overall, the first part of the book is very useful, but the more complex subjects are not covered with the depth they require.

This is a comprehensive and masterfully written book; all MBA students and anybody doing business in or curious about the global economy will benefit from reading this work. All the fundamental principles of the field are clearly described and extensive real-world examples and case studies are given in which principles are synthesized and analyzed to create a very understandable and thorough learning framework. The result is one of the best textbooks I have ever read. The complex subjects of exchange rates, international monetary system, currency forecasting, country risk, foreign exchange rates, currency futures and options, swaps and interest rate derivatives, translation and transaction exposure, measuring and managing economic exposure, corporate strategy and capital budgeting for the multinational corporation, and more are covered.

This book covers a comprehensive range of topics regarding international finance and economics. A good deal of the material covers macroeconomic issues that a country will face but there is even more infomration relevant to decisions and situations that companies must deal with when entering foreign markets. The breadth of information makes this book appropriate whether you want a blueprint for doing business overseas or just want to better understand the impact of global trade.

Shapiro is very well respected as an economist and this book is a good example why. I was fortunate enough to have him as a professor in an MBA program and can say he has an amazing command of the issues as well as the ability to communicate his knowledge very effectively. The writing in this book is clear and concise with a ton of info packed into each chapter. Buy it, you won't find a better text on this subject.

Product Details :
Hardcover: 784 pages
Publisher: Wiley; 9 edition (March 2009)
Language: English
ISBN-10: 0470415010
ISBN-13: 978-0470415016
Product Dimensions: 9.1 x 7.6 x 1.2 inches

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The Family Office Book: Investing Capital for the Ultra-Affluent 1st edition, Richard C. Wilson

"Packed with information about what high-net worth individuals want, need and get from professional money managers. Richard pulls back the curtain on the almost mystical world of the super-wealthy for investors and for anyone getting into the family office business.

- Pimm Fox, Bloomberg TV and radio anchor. Taking Stock with Pimm Fox


The Family Office Book is great because it explains exactly how the family office industry works, how the ultra wealthy are investing their money, and how the fund manager selection process works.

- Michael Skapoullis, Certified Hedge Fund Professional (CHP) designation alumni

"Richard works with family offices and ultra-wealthy clients on a day-to-day basis. "The Family Office Book" provides a unique perspective into exactly how those with $20M, $100M, or $1B are using family office wealth management vehicles to manage their capital."

- Russ Alan Prince, President of Prince & Associates, Inc.


"The Family Office Book is unique as the most comprehensive study of the family office world. It provides important perspective to families, family office management and clients of family offices. A must read."

- Charles B. Grace Jr., Director of Threshold Group, Founder of Ashbridge Investment Management

"Anyone that wants to be in the family office space needs to read this book. It has countless bits of valuable advice. It will be required reading for everyone that joins my family office team."
- Noah B. Rosenfarb, CPA/ABV/PFS, Managing Director, Freedom Wealth Advisors

This book contains well over $20,000 worth of advice in direct audio transcript form from top family office chief executive officers, chief investment officers, portfolio managers, and executives. In addition to my investment of over 400 hours in writing this text we have surveyed over 40,000 members of the Family Offices Group association, and conducted over 40 hours of audio interviews to create this resource. The global views in this book were formed by meetings with dozens of family offices in Moscow, Sao Paulo, Singapore, Tokyo, Monaco, and Liechtenstein. Our goal is to make this a central resources for teams of family office professionals in all corners of the world.

I wrote this book for single and multi-family office professionals and ultra-high net worth individuals who want to further explore how family offices operate and deploy capital.

My current role involves providing the best-of-breed fund managers to family offices. Years ago, when I first started working with family offices, I wanted to learn more about this industry. Much to my surprise, I found there were very few books or web sites dedicated to the subject.

After several years of working with family offices, I started FamilyOfficesGroup.com, the first free-to-access educational web site on the family office industry. Since then, we have been posting new educational resources to the web site each week, and we have seen the association's membership grow from five initial members to its current level of 40,000-plus members from all over the world.

Objective: The objective of this book is to provide you with a $1,000 multimedia training experience for just the small price of this book. In my attempt to create this value, I provide you with insights on the operations, capital deployment best practices, investment processes, portfolio allocations, investment committees, and fund manager selection processes of family offices using instructional videos, audio MP3s, and other unique resources you simply won't find anywhere else.

Is This Book Right for You?

While this book was written primarily for family office professionals, ultra-high net worth individuals and fund managers will also gain a better understanding as to why family offices exist, what function they serve, and how they manage capital. Moreover, this book will assist you in making a more-educated decision when selecting a family office to meet your needs.
Understanding how family offices invest their capital is important for the healthy growth of the industry so family office executives and entry-level professionals can see how their peers are investing. It is also important for ultra-high net worth individuals to know what to expect, how a family office may invest their money, and what questions to ask when they sit down to hire a family office.

What This Book Is Not

The main purpose of this book is to explore how family offices operate and deploy their capital through fund manager selection, cash management, and portfolio construction. This book is not a quantitative, statistical research study, or set of recommendations that family offices should follow. You will not find PhD-level mathematical models showing how to calculate the true risk of particular asset classes, or in-depth financial models of efficient portfolios, as there are dozens of books already written on these important topics. Instead, this book contains valuable insights from some of the world's top family offices.

What Is Unique about This Book?

Most books present only one perspective, opinion, or angle on an issue or industry. Rarely does a single individual's expertise present the complete diverse picture of what is going on regionally or globally within any industry, however, making those books an incomplete resource.

To prepare for this book, I read and reviewed each of the other family office books currently in print. Many of them are valuable and worth reading; they provide valuable quantitative statistics, research, and case studies in a few instances. I know for certain, however, that this book is unique; you get to read the direct thoughts of dozens of global family offices, including several that are frequently listed as being among the largest and most successful top 50 family offices in the world.

To write this book, I leveraged the 40,000-plus member family office association that we manage, the Family Offices Group. To make sure this book presented ideas as diverse as the family office industry itself, we spoke with 'thousands of family offices and conducted recorded interviews with dozens of single and multi-family offices to create both the Family Office Monthly Newsletter, our training and certificate program on family offices called the Qualified Family Office Professional (QFOP) program, and this book.
The interviews were conducted with family offices from Australia, Israel, Dubai, Monaco, United States, Switzerland, Singapore, and many other locations. Each of these interviews lasted for 30 to 90 minutes, and, once transcribed, the interviews in total resulted in 225,000 words' worth of family office advice and insights. The average family office executive we interviewed had 22 years of experience, so in total this book and our newsletter constitute 756 years of industry experience.

This is the only family office book that contains family office interview transcripts, MP3 audio interview downloads, dozens of instructional video modules, recorded family office conference presentations, and free PDF templates. I have made every effort to ensure that this is not simply a book, but a high-end multimedia training experience for those who have the time and interest to use it as such.

I have been completing research on and working with family offices of different types for almost 10 years now, and I think it is important to share what my perspective has been of family offices so that readers can understand where I am coming from in this book. I study family offices because my entire career and business revolves around the family office industry; it seems the more I share in the form of speaking, recording videos, publishing articles, and so on, the more I am rewarded in unexpected ways for this hard work.

See the video "FOG Overview," at FamilyOfficesGroup.com/Video2

I am motivated to dig as deep as I can into the truth of how this industry operates and invests capital; if I don't know what family offices are looking for, I fail in operating the Family Offices Group association and our Richard Wilson Capital Partners business. If I don't have strong value-first relationships with family offices, I'm out of work. I care very little about collecting $8 book royalties and I care a lot about making this book so valuable that it is a conversation starter between you and me.

Product Details :
Hardcover: 336 pages
Publisher: Wiley; 1 edition (August 7, 2012)
Language: English
ISBN-10: 1118185366
ISBN-13: 978-1118185360
Product Dimensions: 6.4 x 1.1 x 9.3 inches

More Details about The Family Office Book: Investing Capital for the Ultra-Affluent 1st edition

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