Network Models in Finance

In Network Models in Finance: Expanding the Tools for Portfolio and Risk Management, a team of celebrated investment and finance educators and practitioners delivers a startlingly insightful and one-of-a-kind discussion of networks in investment management. Guided throughout by contemporary graph theory, the book explains how to identify and measure various types of networks and their characteristics in portfolio and risk management.

You’ll learn to construct diversified portfolios with reduced risk exposure by understanding the link between price and return movements of different asset classes and factors. You’ll also discover how to perform better risk management by understanding systematic, systemic, and counterparty risk and by monitoring changes in the financial system that indicate an incipient or potential financial crisis.

Network Models in Finance adopts a thoroughly “practitioner–first” approach. It provides practical examples of broad financial data to show the impressive possibilities available to those who wish to visualize, describe, and investigate markets in an entirely new way. It also demonstrates the interactions, causal relationships, and optimizations within network-based frameworks and their direct applications to the financial markets.

Finally, the authors walk you through a variety of algorithms enhanced by tested code that you can implement immediately and use on your own datasets.

Perfect for asset managers and investors interested in making use of networks in research, trading, and portfolio management, Network Models in Finance is a must-read application of an effective, practical, and increasingly popular theory to the financial and investing markets.