In this second edition of their popular text, the authors take into
account recent developments in the field, and changes in their own
thinking and teaching. The chapters on Incomplete Markets and Interest
Rate Theory have been updated and extended, there is a new chapter on
the important and growing area of Credit Risk and, in recognition of the
increasing popularity of Lévy finance, there is considerable new
material on: - Infinite divisibility and Lévy processes - Lévy-based
models in incomplete markets Further material such as exercises,
solutions to exercises and lecture slides are also available via the web
to provide additional support for lecturers.