>>13865618This post made me go to my university library and check this out (i'm a math major)
After reading the first chapter, it seems like it has some good stuff in it, and hints that it will be using the heat equation for modelling in later chapters, but I feel that the authors are a little to vague in their explanation of financial instruments. A couple times throughout the chapter I had to sit there a while and think through exactly the authors were trying to say.
All in all though, it looks like it will have some useful information in it, though it is clearly dated (at least my edition is the 1995 edition) so I'm not to sure how much outdated info there is, or which info is outdated, but that shouldn't really matter too much since it is only an introduction to mathematical modelling of financial derivatives.
The further reading section for the quite a few chapter includes Hull (1993) Options, Futures and Other Derivative Securities, second edition, Prentice-Hall.
Unfortunately my library doesn't have an edition of Hull so I can't look at it.
If you have access to a university library, see if they have these books, and also check out the other books that are included in the further reading section.
That's what I'll be doing.
