The Math Behind Wall Street: How the Market Works and How to Make It Work for You [Paperback]

Nicholas Teebagy (Author), Amir D. Aczel (Introduction)

Book Description

Publication Date: March 1, 2000

In The Math Behind Wall Street, Nick Teebagy speaks intelligently to investors at all levels of experience. A mathematician, Teebagy begins by exploring key terms ranging from statistics and probability to covariance and correlation, and then connects them to the way the stock market actually works. The book builds on each lesson to reinforce general knowledge and prepare the reader for more challenging ideas. As investors increasingly understand how to deal with concepts such as uncertainty and standard deviations, the numbers become less intimidating and Wall Street loses its menace. This book can help investors and advisors make smart decisions and minimize their risk.

Editorial Reviews

Amazon.com Review

By outlining and explaining the enigmatic terms and concepts used to track and ultimately determine stock movements, The Math Behind Wall Street: How the Market Works and How to Make it Work for You, by Bentley College mathematics professor Nicholas Teebagy, is designed to provide average investors with financial tools that usually are the province of professionals. Intimidated by the likes of ARCH/GARCH models and neural networks? Don't be. Teebagy begins by describing the basics of probability and risk in order to clarify the way that uncertain future events are taken into account to form a well-reasoned investment analysis. In clear language, and with the welcome assistance of numerous charts and graphs, he then goes on to specify how all this can be used to calculate the potential performance of an entire portfolio. Lastly, he offers an introduction to advanced topics such as the aforementioned ARCH/GARCH models (for tracking periods of continued volatility) and neural networks (which attempt to imitate the way human brains process information). While not for the fiscally faint of heart, this short but information-packed volume will assist serious investors as they try to keep ahead of evolving market trends. --Howard Rothman --This text refers to an out of print or unavailable edition of this title.

Product Details

• Paperback: 128 pages
• Publisher: Basic Books (March 1, 2000)
• Language: English
• ISBN-10: 1568581602
• ISBN-13: 978-1568581606
• Product Dimensions: 7.7 x 5.4 x 0.3 inches
• Shipping Weight: 4.8 ounces (View shipping rates and policies)
• Average Customer Review: 4.1 out of 5 stars  See all reviews (7 customer reviews)
• Amazon Best Sellers Rank: #1,297,585 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

33 of 34 people found the following review helpful:

4.0 out of 5 stars Excellent book, but much too brief., July 10, 1999

By A Customer

This review is from: The Math Behind Wall Street: How the Market Works and How to Make It Work for You (Hardcover)

This is a very good introduction to the basic mathematics used in Wall Street. The author is a professor of mathematics, which explains the ease in which he explains all of the mathematical concepts for even the average reader. The downside to this book is that it does not go very far. Given its small size, only 100 pages, I feel that he could have gone on much further into more advanced topics. He starts with means and variances, and works his way through correlation, risk measures, performance measures, investment planning, and indexes. He wraps up with some ultra-brief comments on ARCH models and neural networks. I would love for him to come out with a much larger, much more detailed, much more advanced book.

7 of 7 people found the following review helpful:

5.0 out of 5 stars The Best Introduction, November 15, 2003

By 

Mr. Z. Uddin "ZeeMan" (UK) - See all my reviews
(REAL NAME)   

This review is from: The Math Behind Wall Street: How the Market Works and How to Make It Work for You (Paperback)

I am currently on a Financial Markets course that is at Masters Level. I bought this book because of its small size and the basic details it covers. I have many other bigger books that go into more detail about stock pricing. However, this book really does explain the basics better than any other I have read. It explains in very simple and statistical terms areas such as the Simple Index Model (SIM), CAPM , Measuring performance of a portfolio, and Modern Portfolio theory. It also touches the surface of advanced moddelling in ARCH/GARCH.

But what really sets it apart is that it explains terms not from a purely academic point of view but a much more informative way by looking at how investors should and would approach a problem. If you have some understanding of statistics such as mean and variance (although both are explained in the book) then I would recommend this book to anyone who is thinking about embarking on an investment course of some kind. It is a definite read for any beginner and will make the course easier becasue it explains the fundamentals very well.

7 of 8 people found the following review helpful:

4.0 out of 5 stars Excellent for technical oriented investors, May 24, 2000

By 

"kingsransom" - See all my reviews

This review is from: The Math Behind Wall Street: How the Market Works and How to Make It Work for You (Hardcover)

This book places heavy emphasis on the technical and mathematical aspect of investing. It is quite excellent but I found the math to be very advanced and therefore it is probably not suitable to most individual investors. Like the previous reviewer, I also found the book to be too brief.

This book definitely has merit, but it isn't right for beginners or the mainstream investment community. The best audience would be investors with highly specialized investing methods.