Math 452 syllabus

Financial Mathematics

Course Description: Introduction to financial mathematics and a brief introduction to financial economics. Students will learn about the time value of money, annuities, loans, bonds, general cash flows and portfolios, immunization, general derivatives, options, forwards and futures, swaps and hedging from the point of view of an actuarial scientist.

Prerequisites: MA 126 Minimum Grade of C.

Calculator: A CAS/SOA approved calculator is required. The TI BA II Plus calculator is highly recommended since it has the ability to solve for interest rates. Only CAS/SOA approved calculators will be allowed during exams.

Suggested Textbook: ACTEX Exam FM Study Manual by Dinius et al
Coverage: Modules 1-7

Learning outcomes: Upon the successful completion of the course a student will understand and apply the proper method (with SOA-approved calculator) to solve for unknowns in the following subjects:

Basic interest rates and factors
Level and varying annuities including non-annual annuities
Financial instruments (Bonds and stocks)
Project appraisal and loans
Duration, Convexity and Immunization
Yield rates
Term structure of interest rates