The ART of Risk Management (eBook)

CHRISTOPHER L. CULP is the Managing Director of CP Risk ManagementLLC and an Adjunct Associate Professor of Finance at the GraduateSchool of Business of the University of Chicago. Formerly Presidentof Risk Management Consulting Services, Inc., and Senior Examinerin the Supervision and Regulation Department of the Federal ReserveBank of Chicago, Dr. Culp is also Senior Fellow in FinancialRegulation with the Competitive Enterprise Institute in Washington,D.C., and a recent Visiting Lecturer in Risk and Insurance at theInstitut für Finanzmanagement, Universität Bern,Switzerland. He is the author of The Risk Management Process:Business Strategy and Tactics and coeditor, along with Merton H.Miller, of Corporate Hedging in Theory and Practice: Lessons fromMetallgesellschaft. Culp holds a PhD in finance from the GraduateSchool of Business of the University of Chicago and a BA ineconomics from the Johns Hopkins University.

ACKNOWLEDGMENTS.

PREFACE: COMPREHENSIVE APPROACH TO CORPORATION FINANCE.

PART I: THE QUEST FOR OPTIMAL CAPITAL STRUCTURE.

CHAPTER 1: The Nature of Financial Capital.

Appendix 1-1: A Brief Introduction to Capital Theory.

Appendix 1-2: A Review of Basic Option Concepts.

CHAPTER 2: A Securities Perspective on Capital Structure.

CHAPTER 3: When Is Capital Structure Irrelevant?

CHAPTER 4: Benefits and Costs of Debt and the "Trade-off Theory" ofOptimal Capital Structure.

CHAPTER 5: Asymmetric Information, Adverse Selection, and the"Pecking Order Theory" of Optimal Capital Structure.

CHAPTER 6: Distinguishing between Capital Structure Theories.

CHAPTER 7: Risk and Signaling Capital.

CHAPTER 8: Regulatory Capital.

PART II: CAPITAL STRUCTURE AND RISK MANAGEMENT.

CHAPTER 9: A Vocabulary of Risk.

CHAPTER 10: Risk Management as a Process.

CHAPTER 11: Risk Management and Capital Structure.

PART III: CLASSICAL RISK TRANSFORMATION PRODUCTS.

CHAPTER 12: Commercial Banking Products.

CHAPTER 13: Derivatives.

CHAPTER 14: Asset Disposition and Securitized Products.

CHAPTER 15: Insurance.

CHAPTER 16: Reinsurance.

PART IV: ALTERNATIVE RISK TRANSFER PRODUCTS.

CHAPTER 17: Alternative Risk Finance vs. Alternative RiskTransfer.

CHAPTER 18: Alternative Risk Finance: Self-Insurance, Captives, andCaptivelike Structures.

CHAPTER 19: Alternative Risk Finance: Finite Risk Products andSolutions.

CHAPTER 20: Integrated Multiline and Multitrigger Alternative RiskTransfer Products.

CHAPTER 21: Committed Capital and Guarantees.

CHAPTER 22: Alternative Risk Securitizations and SecuritizedProducts.

PART V: PRACTICAL CONSIDERATIONS FOR WOULD-BE ARTISTS.

CHAPTER 23: USAA Prime: Choice Cats for Diversifying Investors(Morton N. Lane).

CHAPTER 24: Emerging Role of Patent Law in Risk Finance (J. B.Heaton).

CHAPTER 25: Weather Derivatives or Insurance? Considerations forEnergy Companies (Andrea S. Kramer).

CHAPTER 26: Convergence of Insurance and Investment Banking:Representations and Warranties Insurance and Other InsuranceProducts Designed to Facilitate Corporate Transactions (Theodore A.Boundas and Teri Lee Ferro).

BIBLIOGRAPHY.

INDEX.