Business SnapshotsPreface1. Introduction2. Banks3. Insurance 4. Mutual Funds and Hedge Funds5. Financial Instruments6. How Traders Manage Their Exposures7. Interest Rate Risk8. Value at Risk9. Volatility10. Correlation and Copulas11. Regulation, Basel II, and Solvency II12. Market Risk VaR: Historical Simulation Approach13. Market Risk VaR: Model-Building Approach14. Credit Risk: Estimating Default Probabilities15. Credit Risk Losses and Credit VaR16. ABSs, CDOs, and the Credit Crunch of 200717. Scenario Analysis and Stress Testing18. Operational Risk19. Liquidity Risk20. Model Risk21. Economic Capital and RAROC22. Risk Management Mistakes to avoidAppendix A: Compounding Frequencies and Interest RatesAppendix B: Zero Rtes, Forward Rates, and Zero-Coupon Yield CurvesAppendix C: Valuing Forward and Futures ContractsAppendix D: Valuing SwapsAppendix E: Valuing European OptionsAppendix F: Valuing American OptionsAppendix G: Taylor Series ExpansionsAppendix H: Eigenvectors and EigenvaluesAppendix I: Principal Components AnalysisAppendix J: Manipulation of Credit Transition MatricesAnswers to Questions and ProblemsGlossary of TermsDerivaGem SoftwareTables For N(x)Index