Fixed income books

[Neuron]

I was wondering if anyone could recommend books that could introduce me to the subject of fixed income if I had no previous experience with it? I am looking for something that blends causal interest/reading with math only to clarify the concept at hand. I am looking to understand concepts like time value of money relative to discounting, what cause bond prices to move, valuations and terminology among other things. So I would like a book that is structured like this, (1) intro to concept/what this concept is> (2) what it is useful for> (3) how to apply it in a real world app.

btw I don't like this book: http://www.amazon.com/Fixed-Income-Securities-Todays-Markets/dp/0471063177

 

[Kenny L]

This one might works: http://www.amazon.com/Handbook-Fixed-Income-Securities/dp/0071440992/

 

[Sanket Patel]

What's wrong with the Tuckman book? I actually think it's one of the better introductory fixed income books. Tuckman does a good job keeping his discussion and examples relevant and practical.

That said, Fabozzi's book is also a good one. Keep in mind, though, that it is not a very focused book as it is essentially a survey of everything fixed income. If you're interested more on valuations, I'd recommend skipping the handbook and going directly to Fixed Income Mathematics, also by Fabozzi.

 

[Neuron]

What's wrong with the Tuckman book? I actually think it's one of the better introductory fixed income books. Tuckman does a good job keeping his discussion and examples relevant and practical.

That said, Fabozzi's book is also a good one. Keep in mind, though, that it is not a very focused book as it is essentially a survey of everything fixed income. If you're interested more on valuations, I'd recommend skipping the handbook and going directly to Fixed Income Mathematics, also by Fabozzi.

Ok fair enough I will try to explain why. I think that the Tuckman book assumes you know introductory knowledge about bonds and pricing which I don't; my background is in equities. Now in my case some of these things I didn't know are easy to look for example why bonds are price in terms like 101-12 3/4 or why there are ticks and half ticks, these where things I didn't know before hand and this book doesn't explain them so I had to look them up. I didn't like the fact that I didn't know where some of the functions came from. This book just gives you functions to plug values into an it doesn't tell you where they came from. The biggest thing is every other line is some equation. I like books that introduce a concept very well by word and at the end the paragraph or section brings it all together with the math. I am like this because I am a programmer, I focus a lot on design(concept) and my code(math) flows according to how my design is laid out. I like books that do the same. keep in mind these are my reasons

 

[bigbadwolf]

I'd recommend skipping the handbook and going directly to Fixed Income Mathematics, also by Fabozzi.

I think Fixed Income Mathematics is a lucid book.

 

[AZPalta]

If you want a more basic approach, try Fixed Income Analysis by Fabozzi.

It is designed for the CFA exam, so it assumes the reader doesn't have that much introductory knowledge.
The book is used for all 3 levels of the exam, so it covers a number of topics and takes a more applied approach.
However, it isn't math intensive since the CFA exam is done with just a financial calculator and pen & paper.
It might be a good supplement to the Fixed Income Mathematics book.

 

[Neuron]

If you want a more basic approach, try Fixed Income Analysis by Fabozzi.

It is designed for the CFA exam, so it assumes the reader doesn't have that much introductory knowledge.
The book is used for all 3 levels of the exam, so it covers a number of topics and takes a more applied approach.
However, it isn't math intensive since the CFA exam is done with just a financial calculator and pen & paper.
It might be a good supplement to the Fixed Income Mathematics book.

btw do most CFA books assume no prior knowledge?

 

[AZPalta]

Been awhile since I saw them with fresh eyes, but I would say CFA readings for Level I assumes no prior knowledge.
Readings for Level 2 and 3 would assume an understanding at least of the preceding levels.

 

[mfegrad]

hmm. that tuckman book is about as easy a read as you'll find. fabozzi's mind dumps that weigh a few pounds each are certainly less readable.

if you sit down and work through the stuff via excel as he goes over it, you'll probably do quite well. and i know you've said you don't care for it, but it truly is the best place to start, in my opinion.

 

[Neuron]

hmm. that tuckman book is about as easy a read as you'll find. fabozzi's mind dumps that weigh a few pounds each are certainly less readable.

if you sit down and work through the stuff via excel as he goes over it, you'll probably do quite well. and i know you've said you don't care for it, but it truly is the best place to start, in my opinion.

Thanks for you reply. I think you might be right I am not in any rush so taking it slow might change my mind.