1 Overview 7

2 Software and Data 9

3 Basic Concepts 10

5 Statistics 17

6 Regression Analysis 21

7 Vector Algebra for Portfolios 24

8 Basic Bond Math 38

11 Revisiting Basic Calculus 61

12 Hypothesis Testing 65

13 Value-at-Risk (VaR) 69

14 CoVaR 76

15 Extending the Regression Framework 78

16 Monte Carlo Simulation 93

17 Forwards and Futures 104

18 Basic Options Concepts 108

19 No-Arbitrage Restrictions on Option Values 113

20 Replication and risk-neutral pricing 129

21 Binomial Model Implementation 132

22 Homework and Solutions 145