Stochastic Calculus for Finance I: The Binomial Asset Pricing Model

Rating:
Summary: Waste of time and money
Review: I wasn't a fan of Shreve's free notes, but words can't describe how bad this book is. Its too easy and insufficient for readers with a strong probability and measure background, and probably too difficult for readers with basic probability. Most of the interesting material comes from deriving the answer from the end of chapter questions, so I recommend doing all of them. On the other hand, the same material is lucidly and fully conveyed in any basic graduate level probability book. For those interested in learning the martingale measure approach to derivative pricing, try the classic from Baxter and Rennie. For those with basic mathematics, go with Neftci's Intro book.

Rating:
Summary: One of the best!
Review: It would be hard to overstate my enthusiasm for this text and its companion volume. In field that is too frequently represented by poorly thought out drafts rushed to market or by advanced mathematical treatments that are not easily understood by individuals more focused on practice, Shreve's texts stand out by being both rigorous and accessible with well thought out examples and exercises.

This particular volume, covering binomial models, covers advanced concepts in a discrete setting. For some it will represent a waste of time and those individuals are best advised to skip to Volume II. However, many intelligent students who are not so comfortable with abstract mathematics will find this a simple and concrete exposition that can serve as a bridge to more advanced theory.