Numerical Techniques in Finance

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MIT Press, 1989 - Business & Economics - 244 pages
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Numerical Techniques in Finance is an innovative book that shows how to create, and how to solve problems in a wide variety of complex financial models. All the models are set up using Lotus 1-2-3; some of the advanced models also make use of Lotus macros.Using the models set out in the book, students and practicing professionals will be able to enhance their evaluative and planning skills. Each of the models is preceded by an explanation of the underlying financial theory. Exercises are provided to help the reader utilize the models to create new individualized applications.Numerical Techniques in Finance covers standard financial models in the areas of corporate finance, financial statement simulation, portfolio problems, options, portfolio insurance, duration, and immunization. A separate section of the book reviews the relevant mathematical and Lotus 1-2-3 techniques. Each of the book's five parts begins with a succinct overview.Simon Benninga is on the faculty of the School of Business Administration of the Hebrew University. He has been Visiting Professor of Finance at the University of Pennsylvania's Wharton School and at the Graduate School of Management at UCLA.

 

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Contents

Overview
3
Analyzing Mergers and Acquisitions
17
Debt Capacity and Riskless Cash Flows
39
Leasing
45
Financial Analysis of Leveraged Leases
57
Overview
69
Calculating the VarianceCo variance Matrix
81
Calculating Efficient Portfolios
87
The Lognormal Distribution
119
Simulating the Normal and Lognormal Distributions
125
Option Pricing
139
Portfolio Insurance
155
Overview
175
Immunization Strategies
189
Overview
201
Matrices
211

Estimating Betas and the SecurityMarket Line
93
Entering Portfolio InformationA Macro
101
References for Portfolio Models
107
The Normal Distribution
113
RandomNumber Generators
217
Macros in Lotus
229
Data Table Commands
239
Copyright

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About the author (1989)

The late Simon Benninga was Professor of Finance and Director of the Sofaer International MBA program at the Faculty of Management at Tel-Aviv University. For many years he was a Visiting Professor at the Wharton School of the University of Pennsylvania.

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