Financial Modeling by Simon Benninga

Financial Modeling by Simon Benninga


Financial Models in Excel can now be easily understood and adapted as finance professionals leaf through this textbook. In this guide, every finance practitioner will get to know the basic and advanced models in all the facets of corporate finance. They will also gain an in-depth understanding of the surrounding concepts on finance, including portfolio management, options, and bonds. 

Financial Modeling now has its fourth edition and features a new section that explains the principles of Monte Carlo methods and their application to portfolio management and valuation. It also contains a new chapter dedicated to discussing term structure modeling. For the easy pickings of the concepts presented, illustrations of Excel spreadsheets are also provided.

 About the Author

Simon Benninga taught at Tel-Aviv University, where he taught Finance and served as Director of the Sofaer International MBA program. Benninga wrote a series of compelling and indispensable resource materials on financial modeling. 

 Table of Contents

The book contains the following topics and contents:

I.  Corporate Finance and Valuation

1. Basic Financial Calculation

2. Corporate Value Overview

3. Calculating the Weighted Average Cost of Capital (WACC)

4. Valuation Based on the Consolidated Statement of Cash Flows

5. Pro Forma Financial Statement Modeling

6. Building a Pro Forma Model: The Case of Caterpillar

7. Financial Analysis of Leasing

II. Portfolio Models

8. Portfolio Models – Introduction

9. Calculating Efficient Portfolios

10. Calculating the Variance-Covariance Matrix

11. Estimating Betas and the Security Market Line

12. Efficient Portfolios Without Short Sales

13. The Black-Litterman Approach to Portfolio Optimization

14. Event Studies

III. Valuation of Options

15. Introduction to Options

16. The Binomial Option Pricing Model

17. The Black-Scholes Model

18. Option Greeks

19. Real Options

IV. Valuing Bonds

20. Duration

21. Immunization Strategies

22. Modeling the Term Structure

23 Calculating Default-Adjusted Expected Bond Returns

V. Monte Carlo Methods

24. Generating and Using Random Numbers

25. An Introduction to Monte Carlo Methods

26. Simulating Stock Prices

27. Monte Carlo Simulations for Investments

28. Value at Risk (VaR)

29. Simulating Options and Option Strategies

30. Using Monte Carlo Methods for Option Pricing

VI Excel Techniques

31. Data Tables

32. Matrices

33. Excel Functions

34. Array Functions

35. Some Excel Hints

VII. Visual Basic for Applications (VBA)

36. User-Defined Functions with VBA

37. Variables and Arrays

38. Subroutines and User Interaction

39. Objects and Add-Ins