Includes bibliographical references and index.

COntents: Introduction -- Finanical products and how they are used for hedging -- How traders manage their exposures -- Interest rate risk -- Volatility -- Correlation and Copulas -- Bank regulation and base II -- The VaR measure -- Market Risk VaR: Historical simulation approach -- Market Risk VaR: Modeling- Building Approach -- Credit risk: Estimating default probabilities -- Credit risk losses and credit VaR -- Credit Derivatives -- Operational risk -- Model risk and liquidity risk -- Economic Capital and RAROC -- Weather, Energy and insurance derivatives -- BIg losses and what we can learn from them -- Appendix A: Valuing forward and futures contracts -- Appendix B: Valuing swaps -- Appendix C: Valuing European options -- Appendix D: Valuing American options -- Appendix E : Manipulation of credit transition matrices -- Answers to questions and problems -- Glossary of terms -- Derivagem software.