The 8th Edition of Stephen Valdez’s book covering the world’s financial markets manages to achieve something which, having read a large sample of financial textbooks, is rare; there is a fine balance between a book that is lightweight and one that is inaccessible to the novice trader, which the author negotiates in this case successfully.
Those among us who are not the most gifted with numbers and the technical nuances at the heart of the markets need not worry, as this book is written in a very relaxed style; this in particular made the book stand out from others I have read or, in more extreme cases, tried to read.
We are first introduced to the world of modern economics, fueled by debt and consumer spending on the ‘never-never’; the history of banking dating back to 13th Century Italy is explained, moving into an overview of the roles of central, commercial and investment banks in today’s economies. As a professional trader it can be very easy to develop an intraday knowledge of your chosen markets without necessarily understanding the fundamental forces at work in the background; the initial chapters of this book will very quickly bring you up to speed, with the added benefit of making you appear highly knowledgeable at the dinner table in what is surely the nation’s topic du jour.
The subsequent chapters provide in-depth analysis of the securities markets, namely money/bond markets, stock exchanges and hedge funds/PE. This is where the book really came into its own for me. For a fixed-income trader you will be able to learn a great deal on how debt instruments are constructed and brought to the markets, as well as some more subtle points on the theory behind their pricing. Foreign Exchange markets are also covered, as are financial futures, options and other derivatives.
A section on insurance is curiously sandwiched between chapters covering economic powers both current and emerging; namely the European Union, China and India. These give a fascinating historical account of how 12 sovereign states came to operate under one currency and financial system, as well as providing an insight into how the East will increasingly dominate the global economic outlook in years to come. Whilst these sections (nor, dare I say, any of the material in this book) will necessarily help you become more profitable as a professional trader, I would consider this book an invaluable introduction to the world of finance as a whole, as well as a useful reference point and source of amusement for the seasoned veteran. Valdez’s work manages to be detailed without being turgid; I would recommend that anyone who is serious about a long-term career in or around the markets should set aside a couple of days to absorb the information in this book – without doubt I feel a more complete trader for doing so.
Amazon Link: https://a.co/2SfhGQb
About the Author from Amazon:
“Stephen Valdez is a retired financial trainer and consultant and is the former Director of Profile Financial Training Plc. He formed Valdez Financial Training in 1985 to provide simple introductory courses on financial markets. The courses were used around the world by major banks, financial institutions, software houses and information providers. The company was later sold to The Financial Training Co. Ltd. with Stephen Valdez acting as consultant.
Professor Philip Molyneux is Head of Bangor Business School, Professor in Banking and Finance and Director of the Institute of European Finance at Bangor University, UK. He previously held the Special Chair of Financial Services and Financial Conglomerates at Erasmus University, Rotterdam, Netherlands, and was Visiting Professor at Bocconi University, Milan, Italy. He has published a variety of texts on banking areas and acted as a consultant to New York Federal Reserve Bank, the World Bank, the European Commission, the UK Treasury, Citibank Private Bank, Bermuda Commercial Bank, McKinsey& co, Credit Suisse and various other international banks and consulting firms.”