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Investment Mathematics

Andrew T. Adams, Philip M. Booth, David C. Bowie, Della S. Freeth

ISBN: 978-0-470-85918-6 July 2003 436 Pages

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Investment Mathematics provides an introductory analysis of investments from a quantitative viewpoint, drawing together many of the tools and techniques required by investment professionals.
Using these techniques, the authors provide simple analyses of a number of securities including fixed interest bonds, equities, index-linked bonds, foreign currency and derivatives. The book concludes with coverage of other applications, including modern portfolio theory, portfolio performance measurement and stochastic investment models.


Part I Security Analysis.

Compound interest.

Fixed-interest bonds.

Equities and real estate.

Real returns.

Index-linked bonds.

Foreign currency investments.

Derivative securties.

Part II Statistics for Investment.

Describing investment data.

Modelling investment returns.

Estimating parameters and hypothesis testing.

Measuring and testing comovements in returns.

Part III Applications.

Modern portfolio theory and asset pricing.

Market indices.

Portfolio Performance Measurement.

Bond analysis.

Option pricing models.

Stochastic investment models.

Compound interest tables.

Student's t distribution: critical points.

Areas in the right-hand tail of the normal distribution.

  • Clearly explains the basics of investment mathematics and statistics
  • Provides numerous practical examples
  • Self-contained chapters so that reader can choose appropriate path based on own needs
  • Excel spreadsheets containing worked examples
  • Questions and answers section