Don Chance Releases Textbook: Financial Risk Management: An End User Perspective

January 30, 2020

Financial Risk Management Textbook

Financial Risk Management: An End User Perspective

BATON ROUGE - Don M. Chance, a professor in the LSU Department of Finance and James C. Flores Endowed Chair of MBA Studies, is the author of the just-released textbook Financial Risk Management: An End User Perspective. This book is credited with leveling the playing field for individuals on the “buy-side” by offering information to educate corporate and institutional users of risk management products with the essential knowledge needed to be an intelligent buyer, incorporating principles that the buy-side should be well versed in to enable them to ask the right questions and avoid being misled by the complexity that is often presented by the sell-side.

“The real origins of this book go back more than 20 years to when I was teaching at Virginia Tech,” Chance said. “There was no course in risk management there or pretty much anywhere else.  It was a subject of great importance to practitioners, but academia was behind. I then created the course. Over the years, my lecture notes and PowerPoints morphed into this book. The actual first draft of the book was used in my class in 2018 and then again in 2019.”

This textbook is a great resource for graduate students, MBA students specializing in finance, advanced undergraduate classes in finance and risk management, as well as corporate and institutional investors.

“Most books and courses about risk management focus on the banking or sell sector,” said Chance. “These are the institutions that sell these risk management products. But most of our students will be buyers of risk management products in the companies they work for. I wanted to educate them to be smarter shoppers.”

“I think practitioners would get a lot out of this, as the focus is very applied," he continues. "I am hoping to reach degree-pursuing students and maybe some that aren’t through LSU Online.” 

Professor Chance has had numerous articles published in academic and practitioner journals along with authoring three other books: An Introduction to Derivatives and Risk Management (Ninth ed.) co-authored with Robert Brooks, Essays in Derivatives: Risk Transfer Tools and Topics Made Easy (Second ed.), and Analysis of Derivatives for the CFA Program. His recent research, Risk and Financial Management, was published by World Scientific in late 2019. This work examines financial institutions that offer risk management products to corporations, governments and institutional investors, who comprise the “buy-side.” In the field of financial risk management, those who comprise the “sell-side” are often at a significant advantage as it employs quantitative experts who provide specialized knowledge on risk management. The extensive body of knowledge on risk management is described as highly technical and mathematical but is directed toward the “sell-side.”

“Last fall I completed the first draft of a new book called Foundations of the Pricing of Financial Derivatives, co-authored with professor Robert Brooks of Alabama. This is on a related topic but is much more advanced. This semester I am teaching a doctoral seminar on the subject and we are class testing the book. When we get the bugs out, we’ll reach out to publishers. And I have no idea what comes after that, but I love writing books. (And I am continuing to keep my hand in academic fiction as well.)”

Don M. Chance, PhD, CFA, previously held the William H. Wright, Jr. Endowed Chair of Financial Services at LSU.  He served as the First Union Professorship in Financial Risk Management at Virginia Tech. Before his academic career, he worked for a large southeastern bank, which is now a part of Regions Bank.

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Elizabeth Eaton
E. J. Ourso College of Business