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• Contents at a Glance
• Table of Contents
• Introduction
• About This Book
• Foolish Assumptions
• Icons Used in This Book
• Beyond the Book
• Where to Go from Here
• Part I: Getting Started with Corporate Finance
• Chapter 1: Introducing Corporate Finance
• Considering Corporate Finance and the Role of Money in the World
• Identifying What Makes Corporate Finance Unique
• Recognising How Corporate Finance Rules Your Life
• Becoming Proactive about Corporate Finance
• Chapter 2: Navigating the World of Corporate Finance
• Visiting the Main Attractions in Finance Land
• Meeting the Inhabitants of Finance Land
• Visiting the Finance Land Information Resources
• Chapter 3: Raising Money for Business Purposes
• Raising Capital
• Acquiring Debt to Raise Funds
• Selling Equity to Raise Cash
• Part II: Reading Financial Statements as a Second Language
• Chapter 4: Seeing What You’re Worth with the Balance Sheet
• Introducing the Balance Sheet
• Knowing the Weights on the Balance Scale
• Assessing Your Assets
• Looking at Liabilities
• Valuing the Company: Shareholders’ Funds
• Making Use of the Balance Sheet
• Chapter 5: Getting Paid with the Profit and Loss Account
• Adding Income and Subtracting Costs: What’s on the Profit and Loss Account
• Putting the Profit and Loss Account to Good Use
• Chapter 6: Easy Come, Easy Go: Understanding the Cash Flow Statement
• Piecing Together a Puzzle of Cash Flows
• Using the Cash Flow Statement
• Chapter 7: Making Financial Statements Useful with Ratio Analysis
• Being Able to Pay the Bills: Liquidity Ratios
• Analysing Efficiency with Activity Ratios
• Measuring Profit Generation and Management with Profitability Ratios
• Evaluating a Company’s Debt Management with Debt Ratios
• Chapter 8: Measuring Financial Wellbeing with Special-Use Ratios
• Focusing on Earnings and Dividends with Investor Ratios
• Generating Earnings from Interest: Ratios for Banks
• Using Ratios to Measure Operating Asset Management
• Part III: Placing Valuations on the Price Tags of Business
• Chapter 9: Determining Present and Future Values: Time Is Money
• Losing Value over Time
• Predicting Future Value
• Calculating the Present Value
• Chapter 10: Looking to the Future with Capital Budgeting
• Understanding Capital Budgeting
• Rating Your Returns
• Netting Present Values
• Determining the Payback Period
• Managing Capital Allocations
• Looking at a Piece of Project Management
• Chapter 11: Bringing on Your Best Bond Bets
• Exploring the Different Types of Bonds
• Looking at Bond Rates
• Reading Bond Information
• Understanding Bond Valuation
• Chapter 12: Being Savvy When Shopping for Shares
• Exchanging Shares: Where to Buy and Sell
• Looking at the Different Types of Orders
• Comparing Long and Short Stocks
• Classifying Shares: Chips, Caps and Sectors
• Knowing Where the Market Stands: Bulls versus Bears
• Watching Stocks and Shares Indices
• Calculating the Value of Stocks and Shares
• Chapter 13: Measuring Valuations of the May-Be: Derivatives
• Introducing the Derivatives Market
• Buying or Selling — Then Again, Maybe Not: Options
• Customising the Contract with Forwards
• Adding Some Standardisation to the Contract with Futures
• Exchanging This for That and Maybe This Again: Swaps
• Part IV: Walking in a Risk Management Wonderland
• Chapter 14: Managing the Risky Business of Corporate Finances
• Understanding that Risk Is Unavoidable
• Investigating Interest Rate Risk and Inflation Risk
• Minimising Market Risk
• Evaluating the Risk of Extending Credit
• Understanding Off-Balance-Sheet Risk
• Factoring in Foreign Exchange Risk
• Identifying Operating Risk
• Looking at Liquidity Risk
• Chapter 15: Through the Looking Glass of Modern Portfolio Theory
• Delving into Portfolio Practicalities
• Hypothesising an Efficient Market
• Risking Returns
• Optimising Portfolio Risk
• Chapter 16: Entering the Science Lab: Financial Engineering
• Creating New Tools through Financial Engineering
• Making Securities from Just about Anything
• Looking at Hybrid Finances
• Bundling Assets
• Appealing to a Large Market with Exotic Finances
• Engineering Your Portfolio to the Max
• Moving into Computational Finance
• Chapter 17: Assessing Capital Structure
• Making More Money than You Borrow
• Calculating the Cost of Capital
• Choosing the Proper Capital Structure
• Part V: Understanding Financial Management
• Chapter 18: Assessing Financial Performance
• Understanding the Importance of Analysing Financial Success
• Using Common-Size Comparisons
• Providing Context by Performing Comparatives
• Determining the Quality of Profits
• Assessing Investment Performance
• Chapter 19: Forecasting Finances Is Easier than Predicting the Weather
• Seeing with Eyes Analytical
• Viewing the Past as New
• Seeing the Future Unclouded: Forecasting
• Chapter 20: Spelling out the ABC of M&A
• Getting the Lowdown on M&A
• Differentiating Between the M and the A
• Clearing up the Mess: Divestitures
• Identifying Motives for M&A
• Measuring What a Business Is Worth to You
• Financing M&A
• Part VI: The Part of Tens
• Chapter 21: Ten Things You Need to Know about International Finance
• Understanding that Trade Imbalances Don’t Exist
• Revealing that Purchasing Power Is Different to Exchange Rate
• Examining Eurobonds (which Aren’t Necessarily from Europe)
• Sorting the Muddled Relationship of Interest and Exchange Rates
• Spotting the Spot Rate and Other Currency Transactions
• Diversifying Can’t Completely Eliminate Risk Exposure
• Cross-Listing Allows Companies to Tap the World’s Resources
• Outsourcing as a Taxing Issue
• Complicating Your Life with Politics
• Knowing Your Neighbours: Cultural Understanding Is Vital
• Chapter 22: Ten Things You Need to Understand about Behavioural Finance
• Making Financial Decisions Is Rarely Entirely Rational
• Executing Sound Financial Decisions Involves Identifying Logical Fallacies
• Getting Emotional about Financial Decisions Can Leave You Crying
• Stampeding in Finance Can Get You Trampled
• Letting Relationships Influence Finances Can Be Dangerous
• Satisficing Can Optimise Your Time and Energy
• Explaining Life in the Improbable: Prospect Theory
• Accepting that People Are Subject to Behavioural Biases
• Analysing and Presenting Information Is Fraught with Problems
• Measuring Irrationality in Finance Is Rational Behavioural Finance
• Index
• About the Authors