Fundamentals of financial instruments : an introduction to stocks, bonds, foreign exchange, and derivatives

Cover -- Title Page -- Copyright -- Contents -- Preface -- Preface to the First Edition -- Acknowledgments -- About the Author -- Chapter 1 An Introduction to Financial Institutions, Instruments, and Markets -- The Role of an Economic System -- A Command Economy -- A Market Economy -- Classification of Economic Units -- An Economy's Relationship with the External World -- The Balance of Trade -- The Current Account Balance -- Financial Assets -- Money -- Money as a Unit of Account or a Standard of Value -- Money as a Medium of Exchange -- Money as a Store of Value -- Money Is Perfectly Liquid -- Equity Shares -- Debt Securities -- Preferred Shares -- Foreign Exchange -- Derivatives -- Forward and Futures Contracts -- Options Contracts -- Swaps -- Mortgages and Mortgage‐backed Securities -- Hybrid Securities -- Primary Markets and Secondary Markets -- Exchanges and Over‐the‐Counter (OTC) Markets -- Brokers and Dealers -- The Need for Brokers and Dealers -- Trading Positions -- The Buy‐side and the Sell‐side -- Investment Bankers -- Direct and Indirect Markets -- Mutual Funds -- Money and Capital Markets -- The Eurocurrency Market -- The International Bond Market -- Globalization of Equity Markets -- Dual Listing -- Fungibility -- Arbitrage -- Arbitrage with ADRs -- GDRs -- Risk -- After the Trade - Clearing and Settlement -- Dematerialization and the Role of a Depository -- Custodial Services -- Globalization - The New Mantra -- Chapter 2 Mathematics of Finance -- Interest Rates -- The Real Rate of Interest -- The Fisher Equation -- Simple Interest &amp -- Compound Interest -- Variables and Corresponding Symbols -- Simple Interest -- Compound Interest -- Properties -- Effective Versus Nominal Rates of Interest -- A Symbolic Derivation -- Principle of Equivalency -- Continuous Compounding -- Future Value -- Present Value.