Pricing Money: A Beginner's Guide to Money, Bonds, Futures and Swaps by Julian A

Description: Pricing Money by Julian A. Wiseman The workings of the City are often shrouded in mystery. This book is a highly practical introduction to the principles of bonds and fixed income for those with little or no previous experience. FORMAT Paperback LANGUAGE English CONDITION Brand New Publisher Description Pricing Money provides a highly practical introduction to the principles of bonds and fixed income and is aimed at readers who have little prior knowledge. The book is written in a style that is not overly mathematical or theoretical but takes a practical approach focusing on the aspects of pricing and trading fixed-income securities that are most relevant to the day-to-day activities of people working in the markets. Starting at a basic level the author explains the concepts and principles behind fixed income in an informative way using every day examples that can be understood by the layman. It includes a listing of the terms used; the rules and conventions; the techniques for valuation and pricing and a description of the different roles within the industry. This book will be an excellent training tool for new recruits to the financial markets. Back Cover This book is an introduction to the markets in deposits, bonds, futures and swaps. It explains the purpose and design of these financial instruments, and how they are used by the various players in the financial system. The book is for new recruits and potential new recruits in financial markets, as well as accountants, lawyers, and those wishing to understand the basic principles of finance. The authors engaging, accessible and non-mathematical style is comprehensible by those with no prior financial knowledge. Flap This book is an introduction to the markets in deposits, bonds, futures and swaps. It explains the purpose and design of these financial instruments, and how they are used by the various players in the financial system. The book is for new recruits and potential new recruits in financial markets, as well as accountants, lawyers, and those wishing to understand the basic principles of finance. The authors engaging, accessible and non-mathematical style is comprehensible by those with no prior financial knowledge. Author Biography J.D.A. WISEMAN is a bond and swap trader at Credit Suisse First Boston, having previously been an analyst there and at J.P. Morgan. The author read mathematics at Queens College, Cambridge, and lives in London. Table of Contents Preface xiii Acknowledgements xv Part 1: A Beginners Toolkit 1 1 Money markets 3 What is money? 3 Why there is a money market? 4 Choosing a maturity 6 Repo 7 Central-bank money-market operations 9 Two money markets 10 The euro 12 Writing money 13 Settlement details 15 Summary 16 2 Government bonds 17 Introduction 17 The concept of yield 18 Example yield calculations 19 Coupon and yield 22 The yield curve 23 Primary dealers 24 Government bond markets 24 Repo as part of the government-bond market 26 Accrued interest 27 Strips 27 Other tradable government debt 29 Non-government debt 31 Rating agencies 32 Summary 33 3 Futures 35 The gold miners problem 35 The gold miners solution 36 Contract specification 37 Credit and margin 38 Cash settlement 39 Cash-settling other contracts 40 The fixings 41 The 3-month interest rate future 43 Price action 44 The strip and TED spreads 46 Arbitrage 47 Some trading jargon 48 Summary 50 4 Swaps 51 Introduction 51 An example 53 Asset swaps 55 A typical swap in detail 56 Credit risk in swaps 58 Trading jargon 59 Swaps and interest rate futures 60 Myth and reality 61 Summary 62 5 Options 63 Introduction 63 Puts and calls 63 What is the option worth? 65 Combinations 66 Underlyings 66 Embedded options 67 Implied volatility 68 Summary 69 6 Foreign exchange 71 The basic rationale 71 Size and conventions 72 Forwards 72 Shake the dice 73 Summary 75 7 Players 77 Governments 77 Pseudo-government issuers 78 Non-Financial corporations 79 Pension funds 79 Insurers 81 Mutual funds 82 Hedge funds 83 Commercial banks 83 Mortgage lenders 85 Central banks 86 Private investors 87 Summary 87 8 People 89 Introduction 89 Proprietary traders 89 Market makers 91 Brokers 92 Salespeople 93 Researchers 94 Back office and middle office 94 Investment bankers 94 Summary 95 9 Price action 97 Why do prices move? 97 Necessity never made a good bargain 99 Stability and leverage 100 Fixed-income prices 101 A stylised crash in fixed income 103 Forwards, zeros and par yields 104 Trading the crash 108 Market irrationality 109 Summary 110 Part 2: More detail 111 10 Swaps revisited 113 Introduction 113 Credit risk in swaps 113 Reducing the credit risk 114 Cross-currency basis swaps 116 The price of a basis swap 117 A cross-currency issue 118 Reducing credit risk in basis swaps 121 Forward rate agreements 122 Summary 122 11 Non-government issuance 125 Introduction 125 Bringing a deal to market 126 The syndicate 128 Book-building: taking orders 129 Pricing a swapped deal 130 Pricing an unswapped deal 131 Some legal details 132 Free to trade 134 An example issue 135 Opportunistic reopenings 136 Summary 137 12 Yield, duration, repo and forward bond prices 139 Measuring risk 139 Yields: compounding frequencies 140 Duration continued 142 Definition of DV 01 144 How coupon affects duration and DV 01 144 An example yield curve 145 A 3s10s flattener 147 A flattener generates cash 148 A forward flattener 148 What happens if nothing happens? 149 Weighting the forward flattener 150 A barbell 151 Carry and slide 152 Summary 153 13 Bond futures 155 Introduction 155 Specification 156 Delivery day 157 The delivery process 158 Cheapest to deliver: at par 159 Cheapest to deliver: far from par 160 CTD calculations before delivery 161 Delivery tail 162 Summary 163 14 Basic fixed-income arithmetic 165 The proportion of a year 165 Yield to price and price to yield 167 Semi to annual: halve and square 167 Forward yield 168 Forward asset swap 168 Summary 168 Index 169 Long Description This book is an introduction to the markets in deposits, bonds, futures and swaps. It explains the purpose and design of these financial instruments, and how they are used by the various players in the financial system. The book is for new recruits and potential new recruits in financial markets, as well as accountants, lawyers, and those wishing to understand the basic principles of finance. The authors engaging, accessible and non-mathematical style is comprehensible by those with no prior financial knowledge. Feature Concise, practical introduction to fixed income. Highly accessible style explains complex subjects in terms of general principles with everyday examples that can be understood by the lay reader. Details ISBN0471487007 Pages 192 Year 2001 ISBN-10 0471487007 ISBN-13 9780471487005 Format Paperback DEWEY 332.6 Illustrations Ill. Language English Short Title PRICING MONEY Media Book Edition 1st Subtitle A Beginners Guide to Money, Bonds, Futures and Swaps Publisher John Wiley & Sons Inc Imprint John Wiley & Sons Inc Place of Publication New York Country of Publication United States DOI 10.1604/9780471487005 UK Release Date 2001-09-28 AU Release Date 2001-11-01 NZ Release Date 2001-11-01 Author Julian A. Wiseman Publication Date 2001-09-28 Audience General US Release Date 2001-09-28 We've got this At The Nile, if you're looking for it, we've got it. With fast shipping, low prices, friendly service and well over a million items - you're bound to find what you want, at a price you'll love! TheNile_Item_ID:102471968;

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