For many years, the stock option has been an investment device used primarily by speculators and some “sophisticated” investors. During the past few years, much more attention has been paid to options by mutual funds, insurance companies, and conservative investors who previously showed little concern for this investment alternative. The opening of the Chicago Board of Trade's exchange for the trading of options will lead to even wider interest in the area.

The trading of security options is one of the fastest growing and most dynamic areas of investment concern. When the Chicago Board of Trade's proposal to develop an exchange for trading option contracts is implemented, security option trading will become an even more important aspect of the investment world.

Part I: INTRODUCTION. 1. The Role and Objective of Financial Management. 2. The Domestic and International Financial Marketplace. 3. Evaluation of Financial Performance. 4. Financial Planning and Forecasting. Part II: DETERMINANTS OF VALUATION. 5. The Time Value of Money. 6. Fixed Income Securities: Characteristics and Valuation. 7. Common Stock: Characteristics, Valuation, and Issuance. 8. Analysis of Risk and Return. Part III: THE CAPITAL INVESTMENT DECISION. 9. Capital Budgeting and Cash Flow Analysis. 10. Capital Budgeting: Decision Criteria and Real Option Considerations. 11. Capital Budgeting and Risk. Part IV: THE COST OF CAPITAL, CAPITAL STRUCTURE, AND DIVIDEND POLICY. 12. The Cost of Capital. 13. Capital Structure Concepts. 14. Capital Structure Management in Practice. 15. Dividend Policy. Part V: WORKING CAPITAL MANAGEMENT. 16. Working Capital Policy and Short-Term Financing. 17. The Management of Cash and Marketable Securities. 18. The Management of Accounts Receivable and Inventories. Part VI: ADDITIONAL TOPICS IN CONTEMPORARY FINANCIAL MANAGEMENT. 19. LEASE AND INTERMEDIATE-TERM FINANCING. 20. Financing with Derivatives. 21. Risk Management. 22. International Financial Management. 23. Corporate Restructuring. Appendix 2A: Taxes. Appendix 5A: Continuous Compounding and Discounting. Appendix 9A: Depreciation. Appendix 10A: Mutually Exclusive Investments Having Unequal Lives. Appendix 14A: Breakeven Analysis. Appendix 20A: The Black-Scholes Option Pricing Model. Appendix 20B: Bond Refunding Analysis.