The Economics of financial markets /
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| Author / Creator: | Houthakker, Hendrik S. |
|---|---|
| Imprint: | New York : Oxford University Press, 1996. |
| Description: | xiii, 361 p. : ill. ; 24 cm. |
| Language: | English |
| Subject: | |
| Format: | E-Resource Print Book |
| URL for this record: | http://pi.lib.uchicago.edu/1001/cat/bib/1694339 |
Table of Contents:
- 1. Introduction
- 1.1. What This Book Is About
- 1.2. Financial Markets and Financial Instruments Defined
- 1.3. Basic Concepts of Accounting
- 1.3.1. The Balance Sheet
- 1.3.2. The Cash Flow Statement
- 1.3.3. The Income Statement
- 1.4. Sources of Information
- 2. The Place of Financial Markets in the Economy
- 2.1. Real Assets and Financial Claims
- 2.1.1. Balance Sheets for the U.S. Economy
- 2.1.2. The International Investment Position of the United States
- 2.1.3. The Distribution of Financial Assets
- 2.2. A Framework for Macroeconomic Analysis of Flows
- 2.2.1. The National Accounts
- 2.2.2. The Flow of Funds Accounts
- 2.2.3. The Relation between Stocks and Flows
- 2.2.4. International Transactions
- 2.2.5. Exchange Rates
- 2.3. The Rate of Interest
- 2.3.1. The Rate of Interest in a Barter Economy
- 2.3.2. Government Borrowing
- 2.3.3. Introducing Money: Nominal and Real Interest Rates
- 2.4. Monetary and Fiscal Policy
- 2.4.1. The Supply of Money
- 2.4.2. The Demand for Money
- 2.4.3. The Objectives of Monetary Policy
- 2.4.4. Fiscal Policy and the Government Budget
- 3. The Supply of Securities
- 3.1. General Characteristics of Securities
- 3.2. The Supply of Government Securities
- 3.2.1. Federal Government Obligations
- 3.2.2. Municipal Bonds
- 3.2.3. Bonds of Foreign Governments and International Organizations
- 3.2.4. Index-Linked Bonds
- 3.3. Corporate Financial Policy
- 3.3.1. Empirical Evidence
- 3.4. The Supply of Corporate Securities
- 3.4.1. Corporate Equities
- 3.4.2. Corporate Takeovers
- 3.4.3. Corporate Bonds
- 3.4.4. Junk Bonds
- 3.4.5. Convertible Securities
- 3.4.6. Partnership Units and Business Taxation
- 3.5. Mutual Fund Shares
- 3.5.1. Money Market Funds
- 3.6. Mortgages and Mortgage-Backed Securities
- 3.7. Claims on Financial Institutions
- 4. The Demand for Securities
- 4.1. The Time Dimension
- 4.1.1. A Case in Microeconomics: Saving for Retirement
- 4.1.2. Present Value and Duration
- 4.1.3. The Calculation of Yields on Zero-Coupon Bonds
- 4.1.4. The Term Structure of Interest Rates
- 4.2. The Risk Dimension
- 4.2.1. The Measurement of Risk
- 4.2.2. Bivariate Distributions
- 4.2.3. Expected Utility
- 4.2.4. Estimating the Mean and Variance of Returns
- 4.2.5. Conditional Probabilities and Expected Values
- 4.3. The Portfolio Complication
- 5. Securities Markets and Their Efficiency
- 5.1. Central Trading Places
- 5.1.1. Stock Exchanges
- 5.1.2. Types of Orders and Their Execution
- 5.1.3. Specialists and Market Clearing
- 5.2. Financial Markets without Central Trading Places
- 5.2.1. The Over-the-Counter Stock Market
- 5.3. Stock Exchanges in Other Countries
- 5.3.1. The International Stock Exchange in London
- 5.3.2. The Tokyo Stock Exchange
- 5.4. Operational Efficiency and the Efficient Market Hypothesis
- 5.4.1. The Weak Form of the EMH, and Technical Analysis
- 5.4.2. Do Equity Prices Follow a Random Walk?
- 5.4.3. The Semistrong Form of the EMH, and Security Analysis
- 5.4.4. How Rapidly Do Prices Adjust to News?
- 5.4.5. The Strong Form of the EMH
- 5.4.6. Conclusions on Informational Efficiency
- 6. The Determination of Equity Prices
- 6.1. Shares as Claims to Future Dividends
- 6.1.1. Steady Growth in the Dividend
- 6.1.2. Aggregate Dividends, Earnings, and Inflation
- 6.2. Shares as Claims to Corporate Net Worth
- 6.3. The Capital Asset Pricing Model
- 6.3.1. The Simplest Form of CAPM
- 6.3.2. Extending the CAPM
- 6.3.3. Estimating Betas
- 6.3.4. Implications for Portfolio Management
- 6.3.5. The Validity of CAPM
- 6.4. Arbitrage Pricing Theory: An Alternative Approach
- 6.5. Appendix: Stock Indexes
- 6.5.1. The Three Main Indexes
- 6.5.2. Some Other Stock Indexes
- 7. Security Analysis
- 7.1. Security Analysis and Market Efficiency
- 7.2. A Modern View of Security Analysis
- 7.2.1. Macroeconomic Developments and Changes in Regime
- 7.2.2. Industry Growth
- 7.2.3. International and Regional Growth
- 7.2.4. Industry Structure
- 7.2.5. Firm-Specific Factors
- 7.3. The Role of Financial Statement Analysis
- 7.3.1. The Adjustment Process of Financial Ratios
- 7.3.2. Pro-Forma Income and Cash Flow
- 7.3.3. Caterpillar Inc.: A Security Analysis and Valuation Example
- 7.4. Shortcuts in Security Valuation
- 7.4.1. Uses and Pitfalls of Price/Earnings Ratios
- 7.4.2. Tobin's q as an Alternative Approach to Securities Valuation
- 8. Options and Options Pricing
- 8.1. The Basics of Stock Options
- 8.1.1. Institutional Aspects: Exchange-Traded Stock Options
- 8.1.2. The Payoff from Buying and Selling Options
- 8.1.3. Combinations of Options
- 8.1.4. Combining Options with Stocks
- 8.1.5. The Put-Call Parity Theorem
- 8.2. The Valuation of Stock Options
- 8.2.1. The Expected Payoff of a European Call
- 8.2.2. Application of the Capital Assets Pricing Model to Options
- 8.2.3. The Black-Scholes Formula for a European Call
- 8.2.4. Alternative Derivations of the Black-Scholes Formula
- 8.2.5. Other Option Models
- 8.2.6. Some Extensions of the European Call Formula
- 8.2.7. The Empirical Relevance of the Black-Scholes Formula
- 8.3. Options and Portfolio Management
- 8.4. Convertible Bonds and Stocks as Options
- 8.5. Other Types of Options
- 9. Futures Contracts and Futures Markets
- 9.1. Forward Contracts
- 9.2. The Origins of Futures Trading
- 9.3. Basic Elements of Futures Contracts
- 9.3.1. Delivery and Cash Settlement
- 9.3.2. Futures and Options
- 9.4. The Organization of Futures Markets
- 9.4.1. Categories of Traders
- 9.4.2. Types of Commodities and Financial Instruments Traded
- 9.4.3. Volume and Open Interest
- 9.5. Appendix: The Euromarkets and the Swap Market
- 9.A.1. Innovations in Euromarket Instruments
- 9.A.2. The Swap Market
- 10. Futures Prices
- 10.1. Profits and Losses on Various Transactions
- 10.1.1. Implied Limits on Simultaneous Price Differences
- 10.2. Relations among Spot and Futures Prices
- 10.2.1. Financial Futures
- 10.2.2. Nonseasonal Commodities
- 10.2.3. Seasonal Commodities
- 10.3. Hedgers, Speculators, and Market Equilibrium
- 10.3.1. A Portfolio Analysis of Hedging
- 10.3.2. Hedging Effectiveness
- 10.3.3. Market Equilibrium
- 10.4. The Role of Expectations
- 10.4.1. Futures Prices as Predictors of Spot Prices
- 10.4.2. Expectations versus Spot-Market Constraints
- 10.4.3. Samuelson's Conjecture on Increasing Volatility
- 10.5. Futures and Portfolio Management
- 10.5.1. Program Trading
- 10.5.2. Portfolio Insurance: A Post-mortem
- 10.5.3. Futures Contracts as an Investment
- 11. Regulation of Financial Markets
- 11.1. The Ethics of Finance and the Economic Function of Financial Markets
- 11.2. The Purposes of Regulation
- 11.2.1. Maintaining Competition
- 11.2.2. Preventing Fraud and Providing Information
- 11.3. Levels of Regulation
- 11.4. Federal Regulation of Trading in Corporate Securities
- 11.4.1. Reporting of Financial Results and Other Developments
- 11.4.2. New Issues
- 11.4.3. Insider Trading
- 11.5. Federal Regulation of Futures Markets
- 11.6. A Case Study: The Silver Manipulation of 1979-1980
- 11.6.1. The Silver Market
- 11.6.2. The Manipulation
- 11.6.3. The End of the Manipulation
- 11.6.4. The Other Side of the Story
- 11.6.5. The Aftermath
- 11.6.6. Regulatory Aspects
- 11.7. Regulation in the United Kingdom
- Notes
- Bibliography
- Author Index
- Subject Index
