All About Derivatives (All About Series) [Paperback]

Michael Durbin (Author)

Book Description

Series: All About Series | Publication Date: August 24, 2005

The answer to trading profit growth lies in derivatives. All About Derivatives explains the major derivatives and their key features of each; vital mechanical issues such as storage, settle- ment, valuation, and payoff; and common types of risk and how to effectively hedge against them. Michael Durbin is known as a derivatives trader and manager for one of the world’s largest, most high-profile hedge funds.

Editorial Reviews

From the Back Cover

Everything you need to know about derivatives--what they are, how they work, and how they can enhance profits and control market risk

Financial derivatives, from standard put and call options to more complex strategies and combinations, are among the most versatile, powerful, and valuable tools available to investors. All About Derivatives introduces you to the many different types of derivatives, providing simple explanations and easy-to-follow methods for using each.

This straightforward, up-to-date examination covers all aspects of derivative contracts, explains techniques for pricing and trading them, shows how to use each to hedge risk or increase profits, and more. Avoiding complicated formulas and theories to focus on the information you need, it shows anyone--from individual investors to corporate risk managers--how derivatives work, how they fit into the larger world of investing, and why they can be the ideal trading vehicle for improving the financial performance of yourself or your organization.

Whatever your level of investing expertise, from beginner to veteran, All About Derivatives will give you the information you need to know:

• Contracts--forwards, futures, swaps, options, and credit derivatives
• Terms--volatility, arbitrage, the greeks, and many more
• Key mechanics--storage, settlement, valuation, and payoff
• Pricing methods and mathematics for determining fair value
• Hedging strategies for managing different types of risk
• Leverage--why it can be your best friend or worst enemy
• And more

About the Author

Michael Durbin is a veteran business systems analyst and project manager specializing in financial derivative trading systems. His projects include high-performance systems for Bank of America, Bank One, and a leading global hedge fund.

Product Details

• Paperback: 240 pages
• Publisher: McGraw-Hill; 1 edition (August 24, 2005)
• Language: English
• ISBN-10: 0071451471
• ISBN-13: 978-0071451475
• Product Dimensions: 8.7 x 5.9 x 0.8 inches
• Shipping Weight: 12 ounces
• Average Customer Review: 4.6 out of 5 stars  See all reviews (16 customer reviews)
• Amazon Best Sellers Rank: #730,399 in Books (See Top 100 in Books)

Customer Reviews

Most Helpful Customer Reviews

38 of 39 people found the following review helpful:

5.0 out of 5 stars A Book for Those Who Need Somewhat More Careful Explanations, January 5, 2006

By 

John L. Williamson "John Williamson" (Richmond, Virginia USA) - See all my reviews
(REAL NAME)   

This review is from: All About Derivatives (All About Series) (Paperback)

I have been trading my own account for a while and got interested in trying to make a few options trades. I went looking for a book so that I could review the basics. I found one book which basically said, "Here is how these terms are defined, and here are some formulas which employ these terms and here are some examples." Well, that left me cold, because the author of that book made no attempt to make sure that I really understood the basic concepts. I "kind of" understood, but not really.

"All About Derivatives" by Michael Durbin is totally different. You can tell from the way he goes about explaining things that he really wants you to understand the basic concepts, and he doesn't want you to feel "dumb" just because he brings it down to a pretty basic level from time to time. What he's trying to do is make sure you don't get tripped up on important concepts at the early stages and he really does bend over backwards to clarify things to a very great degree. Whereas it was pointless to try to work my way through the first book, I read "All About Derivatives" pretty much from cover to cover and I think there were only a few places where I still got stuck. Still, that's a vast improvement over the other book and in fact it was only after reading Durbin's book that I was able to make sense of the first one.

Some people try too hard to impress you with how academic their approach is. Michael Durbin doesn't play that game. He really wants you to understand the concepts and I think that if he needed to do cartwheels to get the point across he would do it.

I wish this guy had written my calculus textbook when I took it in college; I wouldn't have had to take it over to improve my grade.

I hope Durbin makes enough money in the derivatives game to retire and write full time. He's quite a talent.

18 of 18 people found the following review helpful:

5.0 out of 5 stars An Excellent Introduction to Derivatives, November 29, 2006

By 

David Wilusz (Boston, MA, USA) - See all my reviews
(REAL NAME)   

This review is from: All About Derivatives (All About Series) (Paperback)

This is an extremely well-written introduction to derivatives. I used it as a supplement to a graduate course in Risk Management which had assigned Don Chase's classic book. I found this book to be much more readable, with less formal notation and fewer equations to wade through (not to mention being much cheaper and easier to carry around). Despite its small size, it still manages to convey the essential characteristics of the major types of derivatives (forwards, futures, swaps, options, and credit derivatives) and how they are priced, without getting bogged down in excessive theory. It's written in a pleasant, conversational style, with (horrors!) even a dash of humor thrown in. It contains the right amount of detail and math in the main text, with a series of appendices and nicely separated subsections for the more mathematically inclined. It's a great introductory text, and I strongly recommend it for anyone starting out in the subject.

11 of 11 people found the following review helpful:

5.0 out of 5 stars A work of excellence, February 15, 2006

By 

E. Paradis "Bumblebee" (Canada) - See all my reviews
(REAL NAME)   

This review is from: All About Derivatives (All About Series) (Paperback)

This book provides the reader with confidence throughout the book, tackling a difficult topic. It was well written, and
things were easy to understand because he made the concepts simple. Its actually the best book I've read on options because it explains what is going on under the hood. Im hoping he'll write another book on another interesting topic soon!