![]() ![]() I think that will add to the value of the book - it can be the gentle introduction to some more advanced concepts, for students and busy practitioners who have very little time (even if they like it) for the math that one sees in some of the advanced derivatives book. Dr S can write on this subject at the level that is deeper (and more satisfying) than Wilmott, and more easy to access than say Shimko or Shreve or even Baxter. In future editions of this book, I would love to see some development of stochastic processes, the concept of filtrations, Ito's Lemma etc. Fama's theory of finance is the only other book (that I've looked at) that starts finance where micro left off, but then who has the time or strength to read it after a 10 hour day. I haven't found it any - Dr Shockley's book was the first one I found that tied what we're doing in finance to the underlying concept of equilibrium as defined in microeconomics. If finance is related to micro economics, one expects to see atleast one instance of this equation in a standard finance text. Pick up any standard text in microeconomics (Silberberg, or Hirshleifer or Henderson and Quandt)- and you will see the one equation repeat over and over again - the First Order Condition tying in the ratio of Marginal Quantities (Costs, Utilities etc), the ratio of prices (wages etc) and the lagrangian multiplier. The book is full of handy examples and solid explanations. The approach to options doesn't start with heavy derivations and equations of stochastic processes - it starts with the concepts of NPV, abritrage and leads on to options (and real options). He's actually taken the time to explain the various models and concepts in finance come together. Dr Shockley's approach to the subject is radically different from any other book I have seen. Thanks for putting this book together Dr Shockley!I took Dr.Shockley's RO course back in school. When the NPV value should be captured by the possibility of future growth options. I think that will add to the value of the book - it can be the gentle introduction to some more advanced concepts, for students and busy practitioners who have very little time (even if they like it) for the math that one sees in some of the advanced derivatives book. Martha Amram and Nalin Kulatilaka 271 provided five different scenarios when real option theory can be applied: When a project needs updates and mid-course strategy corrections. ![]() I took Dr.Shockley's RO course back in school. ![]()
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