Financial Modeling
Too often, finance courses stop short of making a connection between textbook finance and the problems of real-world business. Financial Modeling bridges this gap between theory and practice by providing a nuts-and-bolts guide to solving common financial models with spreadsheets. Simon Benninga takes the reader step by step through each model, showing how it can be solved using Microsoft Excel. The long-awaited third edition of this standard text maintains the "cookbook" features and Excel...
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The third edition of this standard text retains the popular "cookbook" features of earlier editions and includes expanded and new coverage of such topics as bank valuation, the Black-Litterman portfolio selection model, Monte Carlo pricing methods, array function, and getting information from the Internet with VBA.
PrefacePreface to the First EditionICorporate Finance Models11Basic Financial Calculations32Calculating the Cost of Capitol27App. 1A Rule of Thumb for Calculating Debt Betas49App. 2Why Is [beta] Such a Good Measure of Risk? Portfolio [beta] versus Individual Stock [beta]51App. 3Getting Data from the Internet523Financial Statement Modeling57App. 1Calculating the Free Cash Flows When There Are Negative Profits83App. 2Accelerated Depreciation in Pro Forma Models844Using Financial Statement Models for Valuation895The Financial Analysis of Leasing101AppThe Tax and Accounting Treatment of Leases1116The Financial Analysis of Leveraged Leases115IIPortfolio Models1297Portfolio Models - Introduction131App. 1Adjusting for Dividends146App. 2Continuously Compounded versus Geometric Returns1488Calculating the Variance-Covariance Matrix1519Calculating Efficient Portfolios When There Are No Short-Sale Restrictions161Appendix17910Estimating Betas and the Security Market Line18511Efficient Portfolios without Short Sales19912Value at Risk (VaR)209AppHow to Bootstrap: Making a Bingo Card in Excel219IIIOption-Pricing Models22913An Introduction to Options23114The Binomial Option-Pricing Model25315The Lognormal Distribution27716The Black-Scholes Model29717Portfolio Insurance31118Real Options32919Early Exercise Boundaries343AppProof358IVBonds and Duration36120Duration36321Immunization Strategies38122Modeling the Term Structure39323Calculating Default-Adjusted Expected Bond Returns40124Duration and the Cheapest-to-Deliver Problem for Treasury Bond Futures Contracts417VTechnical Considerations42925Random Numbers43126Data Tables44327Matrices44928The Gauss-Seidel Method45729Excel Functions46130Some Excel Hints479VIIntroduction to Visual Basic for Applications49131User-Defined Functions with Visual Basic for Applications493AppCell Errors in Excel and VBA51632Types and Loops51933Macros and User Interaction53934Arrays55735Objects581AppExcel Object Hierarchy601References603Index611
\ From the PublisherFor the 2nd Edition: "Benninga has a clear writing style and uses numerous illustrations, which make this book one of the best texts on using Excel for finance that I've seen." Ed McCarthy Ticker Magazine\ For the 2nd Edition: "The author describes this as a 'cookbook'and that is a good analogy.... Its breadth is extensive, covering simple present valuing and cost of capital... to the likes of real options and early exercise of American-style options.... A worthwhile acquisition." Paul Dentskevitch Risk Magazine\ \ \
