Multinational Finance assumes the viewpoint of the financial manager of a multinational corporation with investment or financial operations in more than one country. The text provides a framework for evaluating the many opportunities, costs, and risks of multinational operations in a manner that allows readers to see beyond the algebra and terminology to the general principles of multinational financial management. Multinational Finance includes coverage of traditional topics such as foreign exchange and Eurocurrency markets, multinational treasury management, management of currency risk exposures (transaction, operating, and translation), country risk, multinational capital structure and cost of capital, taxation of foreign source income, and international portfolio diversification. Also included are distinctive chapters on the economic rationale for hedging currency risks, derivatives markets (with separate chapters on currency futures, options, and swaps), real options in international markets, international corporate governance, and international asset pricing. Intended for MBA and advanced undergraduate classes, the text requires only a single preparatory course in finance.
Chapters that extend material from the first course begin with a brief review of the fundamentals. Numerous graphs and figures assist the reader in understanding key financial concepts and techniques are used in practice. Advanced material is placed in chapter appendices, so that study can be tailored to each individual's objectives.
Table of Contents
PART ONE: The International Financial Environment. Chapter 1 An Introduction to Multinational Finance. Chapter 2 World Trade and the International Monetary System. Chapter 3 Foreign Exchange and Eurocurrency Markets. Chapter 4 The International Parity Conditions. PART TWO: Derivative Securities for Financial Risk Management. Chapter 5 Currency Futures and Futures Markets. Chapter 6 Currency Options and Options Markets. Chapter 7 Currency Swaps and Swaps Markets. PART THREE: Managing the Risks of Multinational Operations. Chapter 8 The Rationale for Hedging Currency Risk. Chapter 9 Treasury Management of International Transactions. Chapter 10 Managing Transaction Exposure to Currency Risk. Chapter 11 Managing Operating Exposure to Currency Risk. Chapter 12 Managing Translation Exposure and Accounting for Financial Transactions. PART FOUR: Valuation and the Structure of Multinational Operations. Chapter 13 Foreign Market Entry and Country Risk Management. Chapter 14 Cross-Border Capital Budgeting. Chapter 15 Multinational Capital Structure and Cost of Capital. Chapter 16 Taxes and Multinational Corporate Strategy. Chapter 17 Real Options and Cross-Border Investment Strategy. Chapter 18 Corporate Governance and the International Market for Corporate Control. PART FIVE: International Portfolio Investment and Asset Pricing. Chapter 19 International Capital Markets. Chapter 20 International Portfolio Diversification. Chapter 21 International Asset Pricing
Kirt C. Butler is an Associate Professor in the Department of Finance at Michigan State University, where he teaches multinational finance and global strategy in MSU's Eli Broad College of Business. He joined the faculty in 1985 after completing his doctorate in Finance at MSU. He also holds an M.B.A. in Finance from the College of Business, an M.S. in Computer Science from the College of Engineering, and a B.A. in Psychology from the Honors College at Michigan State University. Professor Butler's research has appeared in a variety of academic and practitioner journals including the Journal of Finance, Journal of Accounting Research, Financial Analysts Journal, Journal of Portfolio Management, Journal of International Money and Finance, and the Journal of International Business Studies, among others. His academic research has been profiled in the New York Times, Time and Money magazines, and on the CNN and CNBC websites.