Book Image

Hands-On Financial Modeling with Microsoft Excel 2019

By : Shmuel Oluwa
Book Image

Hands-On Financial Modeling with Microsoft Excel 2019

By: Shmuel Oluwa

Overview of this book

Financial modeling is a core skill required by anyone who wants to build a career in finance. Hands-On Financial Modeling with Microsoft Excel 2019 explores terminologies of financial modeling with the help of Excel. This book will provides you with an overview of the steps you should follow to build an integrated financial model. You will explore the design principles, functions, and techniques of building models in a practical manner. Starting with the key concepts of Excel, such as formulas and functions, you will learn about referencing frameworks and other advanced components for building financial models. Later chapters will help you understand your financial projects, build assumptions, and analyze historical data to develop data-driven models and functional growth drivers. The book takes an intuitive approach to model testing and covers best practices and practical use cases. By the end of this book, you will have examined the data from various use cases, and have the skills you need to build financial models to extract the information required to make informed business decisions.
Table of Contents (15 chapters)
Free Chapter
Section 1: Financial Modeling - Overview
Section 2: The Use of Excel - Features and Functions for Financial Modeling
Section 3: Building an Integrated Financial Model

Understanding mathematical models

In the scheme of things, the best or optimum solution is usually measured in monetary terms. This could be the option that generates the highest returns, the least cost option, the option that carries an acceptable level of risk, and the most environmentally friendly option, but is usually a mixture of all these features. Inevitably, there is an inherent uncertainty in the situation, which makes it necessary to make assumptions based on past results. The most appropriate way to capture all the variables inherent in the situation or problem is to create a mathematical model. The model will establish relationships between the variables and assumptions, which serve as an input to the model. This model will include a series of calculations to evaluate the input information and to clarify and present the various alternatives and their consequences. It is this model that is referred to as a financial model.