Financial Modeling

"Simon Benninga's book is the best resource on the market for people interested in DOING finance. The spreadsheet examples are easily used, state-of-the-art and unique. The use of VBA is particularly useful, given that it is rapidly becoming the programming language of choice on the Street. I would highly recommend this book to both academics and practitioners interested in constructing finance models." -- Tim Opler, Director, Liability Management, Deutsche Morgan Grenfell and Department of Finance, Ohio State University

Too often, finance courses stop short of making a connection between textbook finance and the problems of real-world business. Financial Modeling bridges this gap between theory and practice by providing a nuts-and-bolts guide to solving common financial models with spreadsheets. Simon Benninga takes the reader step by step through each model, showing how it can be solved using Microsoft Excel. In this sense, this is a finance "cookbook," providing recipes with lists of ingredients and instructions.

Areas covered include the computation of corporate finance problems, standard portfolio problems, option pricing and applications, and duration and immunization. The author includes a set of chapters dealing with advanced techniques, including random number generation, matrix manipulation, and the Gauss-Seidel method.

Although the reader should know enough about Excel to set up a simple spreadsheet, the author explains advanced Excel techniques such as functions, macros, the use of data tables, and VBA programming. The book comes with a disk containing Excel worksheets and solutions to end-of-chapter exercises.

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Simon Benninga is Professor of Finance at Tel Aviv University and Visiting Professor of Finance at the Wharton School at the University of Pennsylvania.