Risk Management and Derivatives

This is one of the best books I ever had. Being able to understand every detail is not easy , but the author does a great job in bringing mathematical concepts with an application perspectives

I am an MBA student and my class requires the use of this book (Risk Management and Derivatives, Stulz, 2003).I completely agree with other's negative comments regarding this book. Equations are written within a paragraph rather than separated out to clarify. The text is written purely on theory - even the "real world" examples are relatively impossible to understand.My professor, after reviewing the assigned exercises from the book, canceled all future assignments noting that the wording of the problems and the text were so confusing that they were almost impossible to work. My professor noted that he refuses to teach this class again until the school uses a different textbook.This book has made a relatively difficult subject impossible to learn.Mike

Risk Management and Derivatives by Rene Stulz is a pioneering book into the need, value, and how to of corporate risk management. Rene Stulz is one of the leaders in this area of finance and has researched and studied it over many years, he is one of the leading experts in the understanding and managing of firm risk. The book motivates the subject by presenting existing and new arguments for the use of risk management by corporations. The book is designed to prepare current and future managers and executives for the world and value of derivatives. To assist the reader, learning objectives are presented at the beginning of each chapter. Many books approach the subject in a very technical or overly simplistic method to the use of derivatives to manage a firms risk, this book gives enough detail for a good understanding and use of derivatives for managing a firm's risk but is not to technical for the non-derivatives expert. All necessary quantitative background is provided in the book.The book begins by discussing derivatives and how they are used to manage risks. It then goes on to look at the value of risk management from the investor as well as the firms viewpoint. The book then examines the basic derivatives tools used for managing risk, including forwards, futures and options. To help the manager in the use of these instruments the book uses many real world examples and discusses the identification and measurement of exposures. To help the reader understand the use and value of the most commonly used derivatives instruments, the author discusses their use and even explains the pricing of options using the Black-Scholes as well as the binomial pricing models. There is even a chapter on interest rate risk, which is the must common risk that is hedged. In the last several chapters of the book, the author goes beyond the basics and discusses more advanced risk management tools and instruments along with a chapter on swaps, which is a fast growing and flexible tool for hedging interest and exchange rate risks. The book concludes with an extensive discussion of the practice of risk management that examines the recent academic studies and predictions of the future of this valuable and growing field.If you are interested in risk management or are a manager that is interested in increasing firm value and reducing risk, then this is a must read. This book is the state of the art in this exciting area of finance and is written by one of its leading pioneers.

Do not buy this book. It's one of the most poorly written book i've ever read. The author likes to use long winded sentenses to explain simple concepts and he does a piss poor job at it. In addition, this book lack quality example problems to help you learn the concepts. When there are examples, they are deeply burried in text rather than clearly shown in a designated area. Imagine an algebra or calculus book with examples explained in text rather than numbers. (.i.e two plus two equals four ... as opposed to 2+2=4) This is how bad this book is. This book is not worth the money. The only way that it's worth the price I paid is if I get a chance to throw it that the author.If anyone out there know of a well written risk management book, please let me know. I'd greatly appreciate it.

I am taking this course at my MBA school "Financial Risk Management". got to say, this book is so ugly dry of illustration and exhibits .. u just feel terribly sick when you start reading it and honestly don't know why they have not assign some other good books available out there. please, if you want this subject for fun reading or something like that, do not approach this one.

The book has almost no straight forward examples. While the concepts are presented well, the mathematics are described very poorly. In addition the end of chapter problems force you to make many assumptions, causing many a long night.

Great book for postgraduate finance students and or professionals.It is not a book for beginners but does explain the advanced theories in an easy way.Gets complicated and does not shy away from more profound topics. Much appreciated.

I agree with Mike's review, in an effort to simplify things this book is incomprehensible. The paragraphs run on and gloss over calculations in written format, missing important clarifications and complicating things further. Then there are other paragraphs that are exceptionally redundant and very basic.