Financial Modeling and Leading with Kindness

Financial Modeling

Author: Simon Benninga

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 computation of corporate finance problems, standard portfolio problems, option pricing and applications, and duration and immunization. The second edition contains six new chapters covering financial calculations, cost of capital, value at risk (VaR), real options, early exercise boundaries, and term structure modeling. A new technical chapter contains a potpourri of tips for using Excel®.

Although the reader should know enough about Excel® to set up a simple spreadsheet, the author explains advanced Excel® techniques used in the book. The book includes chapters dealing with random number generation, data tables, matrix manipulation, and VBA programming. It also comes with a CD-ROM containing Excel® worksheets and solutions to end-of-chapter exercises.

Table of Contents:

	Preface
	Preface to the First Edition
I	Corporate Finance Models	1
1	Basic Financial Calculations	3
2	Calculating the Cost of Capitol	27
App. 1	A Rule of Thumb for Calculating Debt Betas	49
App. 2	Why Is [beta] Such a Good Measure of Risk? Portfolio [beta] versus Individual Stock [beta]	51
App. 3	Getting Data from the Internet	5 2
3	Financial Statement Modeling	57
App. 1	Calculating the Free Cash Flows When There Are Negative Profits	83
App. 2	Accelerated Depreciation in Pro Forma Models	84
4	Using Financial Statement Models for Valuation	89
5	The Financial Analysis of Leasing	101
App	The Tax and Accounting Treatment of Leases	111
6	The Financial Analysis of Leveraged Leases	115
II	Portfolio Models	129
7	Portfolio Models - Introduction	131
App. 1	Adjusting for Dividends	146
App. 2	Continuously Compounded versus Geometric Returns	148
8	Calculating the Variance-Covariance Matrix	151
9	Calculating Efficient Portfolios When There Are No Short-Sale Restrictions	161
	Appendix	179
10	Estimating Betas and the Security Market Line	185
11	Efficient Portfolios without Short Sales	199
12	Value at Risk (VaR)	209
App	How to Bootstrap: Making a Bingo Card in Excel	219
III	Option-Pricing Models	229
13	An Introduction to Options	231
14	The Binomial Option-Pricing Model	253
15	The Lognormal Distribution	277
16	The Black-Scholes Model	297
17	Portfolio Insurance	311
18	Real Optio ns	329
19	Early Exercise Boundaries	343
App	Proof	358
IV	Bonds and Duration	361
20	Duration	363
21	Immunization Strategies	381
22	Modeling the Term Structure	393
23	Calculating Default-Adjusted Expected Bond Returns	401
24	Duration and the Cheapest-to-Deliver Problem for Treasury Bond Futures Contracts	417
V	Technical Considerations	429
25	Random Numbers	431
26	Data Tables	443
27	Matrices	449
28	The Gauss-Seidel Method	457
29	Excel Functions	461
30	Some Excel Hints	479
VI	Introduction to Visual Basic for Applications	491
31	User-Defined Functions with Visual Basic for Applications	493
Ap p	Cell Errors in Excel and VBA	516
32	Types and Loops	519
33	Macros and User Interaction	539
34	Arrays	557
35	Objects	581
App	Excel Object Hierarchy	601
	References	603
	Index	611

Leading with Kindness: How Good People Consistently Get Superior Results

Author: William F Baker

In the world of business, kindness is regarded as weakness—so the development of it as a leadership trait is sorely overlooked. It turns out however, that being kind is a crucial attribute of some of the world's most successful business leaders—leaders whose success is anchored in their integrity, credibility, vision, insight, inclusion, and fairness. And kindness is not some intangible quality that one either "has" or doesn't, it is a combination of quantifiable, learnable, and refinable traits and skills.

Leading with Kindness identifies six ingredients of kindness — compassion, integrity, gratitude, authenticity, humility, and humor that are absolutely essential to powerful leadership. This audiobook also points out obstacles to each of the six qualities, and offers real-world, everyday management and leadership approaches that build and demonstrate each one.

You are not a respected leader simply because you are nice, fun, and non-th reatening. But if you are truly kind, genuinely committed to the welfare of your company and your people through thick and thin—you will reap the benefits of trust, honesty, commitment, and loyalty from the seeds of kindness you have sown.

Publishers Weekly

Say "boss" and many people think of Donald Trump throwing his weight around on The Apprentice. But is that the most effective style of leadership? Not necessarily, argue Baker and O'Malley, who posit that successful leaders accomplish more with kindness and empathy than with aggression. According to the authors, true kindness is not to be confused with weakness, indulgence or mere likability; being genuinely kind means clearly communicating expectations and goals, pushing colleagues to improve and excel and encouraging them to try out things they are uncertain they will like. The book details the hallmarks of successful and kind leaders: compassion, integrity, gratitude, authenticity, humility, honor and the importance of maintaining credibility with one's employees and clients. While the authors' emphasis on honesty and mentorship is incontrovertibly well-intentioned, the paucity of practical advice and the dry presentation are more suited to an academic article, rather than an entire book. Readers looking for a helpful guide will be inspired but ultimately disappointed. (Aug.)

Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

Sarah Statz Cords - Library Journal

Both ostensibly about leadership, these titles differ in tone and focus. Baker (CEO, Educational Broadcasting Corporation) and O'Malley (senior business editor, Yale Univ. Press) emphasize developing a "constellation of behaviors" that could best be described as kindness, while The PITA Principle offers an extended metaphor comparing Pain In The Ass (PITA) employees to actual sandwiches (the soggy, the crusty, etc.) and lists methods for working with such challenging subordinates and colleagues. Baker and O'Malley deny that being kind means a good manager must be a pushover, suggesting instead that offering clear expectations, telling the truth, fostering growth, and mentoring future leaders are not only good for the people involved but also good for business. Their book is the more scholarly of the two, with each chapter systematically offering bullet-point suggestions, insights gained from personal interviews with successful leaders, and helpful references. It starts slowly but is ultimately a credible guide for emphasizing the qualities of gratitude, authenticity, humility, and humor.

The PITA Principle is a much lighter read. Each chapter offers a definition of a different type of PITA, a list of their pop culture counterparts, and a discussion of each type's strengths and weaknesses. Orndorff and Clark, both associated with the Career Services Center, Pennsylvania State University, also suggest that PITA could stand for Professionals Increasing Their Awareness; to that end, they conclude with self-tests for determining personal PITA tendencies, as well as a final chapter outlining how to establish positive working relationships. Public libraries with largebusiness collections might consider either book to round out their management collections; academic and special libraries may find more of lasting value in Leading with Kindness.

Table of Contents:

Ch. 1 What kind leaders do 11

Ch. 2 Who kind leaders are 37

Ch. 3 Expectations matter 77

Ch. 4 The truth matters 119

Ch. 5 Growth matters 155

Ch. 6 Preparing the next generation of leaders 193

Appendix 217

Index 229