A serious source of information for those looking to reverseengineer business deals
It's clear from the current turbulence on Wall Street thatthe inner workings of its most complex transactions are poorlyunderstood. Wall Street deals parse risk using intricate legalterminology that is difficult to translate into an analyticalmodel. Reverse Engineering Deals on Wall Street: A Step-By-StepGuide takes readers through a detailed methodology ofdeconstructing the public deal documentation of a modern WallStreet transaction and applying the deconstructed elements tocreate a fully dynamic model that can be used for risk andinvestment analysis.
Appropriate for the current market climate, an actualresidential mortgage backed security (RMBS) transaction is takenfrom prospectus to model by the end of the book. Step by step,Allman walks the reader through the reversing process with textualexcerpts from the prospectus and discussions on how it directlytransfers to a model. Each chapter begins with a discussion ofconcepts with exact references to an example prospectus, followedby a section called "Model Builder," in which Allman translates thetheory into a fully functioning model for the example deal. Alsoincluded is valuable VBA code and detailed explanation that showsproper valuation methods including loan level amortization and fulltrigger modeling.
Aside from investment analysis this text can help anyone whowants to keep track of the competition, learn from others publictransactions, or set up a system to audit one's ownmodels.
Note: CD-ROM/DVD and other supplementary materials arenot included as part of eBook file.