**Fundamentals of Futures
and Options Markets, **

Many changes have been made to
update material and improve the presentation. The derivatives market’s move toward OIS discounting has continued
since the eighth edition was written. Indeed OIS discounting is now the
standard valuation approach. This has allowed me to streamline the material in
the first seven chapters of *Fundamentals*.
LIBOR discounting is no longer presented as a way to value instruments such as
swaps and forward rate agreements. The valuation of these instruments requires
(a) forward rates for the rate used to calculate payments (usually LIBOR) and
(b) zero coupon risk-free zero curve used for discounting (usually the OIS zero
curve). Most instructors will find the new presentation appealing and more
logical. It can be extended to situations where payments are dependent on any
risky rate.

Other
changes include

·
A more detailed discussion of new
regulations concerning the trading and clearing of over-the-counter derivatives

·
A
major revision to the chapter on swaps (Chapter 7) to improve
presentation and reflect the derivatives markets’ move to OIS discounting

·
A fuller description of the impact of
daily settlement when futures are used for hedging

·
More details on the calculation and
use of Greek letters

·
A fuller discussion of the expected
shortfall measure in Chapter 20, reflecting its increasing importance

·
A new version of the acclaimed
software DerivaGem, tailored to the needs of readers
of this book