Book description
The recent financial crisis brought to light many of the
misunderstandings and misuses of exotic derivatives. With market
participants on both the buy and sell-side having been found guilty of
not understanding the products they were dealing with, never before has
there been a greater need for clarification and explanation.
Exotic Options and Hybrids is a practical guide to structuring,
pricing and hedging complex exotic options and hybrid derivatives that
will serve readers through the recent crisis, the road to recovery,
the next bull market and beyond. Written by experienced practitioners,
it focuses on the three main parts of a derivative's life: the
structuring of a product, its pricing and its hedging.
Divided into four parts, the book covers a multitude of structures,
encompassing many of the most up-to-date and promising products from
exotic equity derivatives and structured notes to hybrid derivatives
and dynamic strategies. Based on a realistic setting from the heart of
the business, inside a derivatives operation, the practical and
intuitive discussions of these aspects make these exotic concepts
truly accessible.
Adoptions of real trades are examined in detail, and all of the
numerous examples are carefully selected so as to highlight
interesting and significant aspects of the business. The introduction
of payoff structures is accompanied by scenario analysis, diagrams and
lifelike sample term sheets. Readers learn how to spot where the risks
lie to pave the way for sound valuation and hedging of such products.
There are also questions and accompanying discussions dispersed in the
text, each exploited to illustrate one or more concepts from the
context in which they are set.
The applications, the strengths and the limitations of various models
are highlighted, in relevance to the products and their risks, rather
than the model implementations. Models are de-mystified in separately
dedicated sections, but their implications are alluded to throughout
the book in an intuitive and non-mathematical manner.
By discussing exotic options and hybrids in a practical,
non-mathematical and highly intuitive setting, this book will blast
through the misunderstanding of exotic derivatives, enabling
practitioners to fully understand and correctly structure, price and
hedge theses products effectively, and stand strong as the only book
in its class to make these “exotic” concepts truly accessible.
MOHAMED BOUZOUBAA is an experienced practitioner
in the world of derivatives, and is currently Head of Derivatives
Trading and Structuring at CDG Capital. His professional expertise
spans the spectrum of topics in exotic options and hybrids having held
positions in Equity Derivatives Sales at Société Générale in Paris, as
a Risk and Fund Management expert at Sophis specializing in the risks
involved in equity, credit and fixed income derivatives, and as a
derivatives structurer at Bear Stearns/JP Morgan Chase in London and
Equity Structured Products Manager at First Gulf Bank in Dubai.
Mohamed holds masters degrees in Financial Engineering and in Applied Mathematics.
ADEL OSSEIRAN is a mathematician by training. His work as a
financial practitioner in derivative pricing includes working in front
office roles as a quantitative analyst and as a derivatives structurer
in London. He studied Mathematics at the University of Oxford and to
PhD level in Financial Mathematics at Imperial College London.
