Introductory description

This module is available for students on a course where it is a listed option and as an Unusual Option to students who have completed the prerequisite modules.

Results from this module may be partly used to determine exemption eligibility in the Institute and Faculty of Actuaries module CM1. (Independent application with the IFoA may be required to receive the exemption.)

Pre-requisites:
Statistics Students: ST218 Mathematical Statistics A AND ST219 Mathematical Statistics B
Non-Statistics Students: ST220 Introduction to Mathematical Statistics

Module web page

Module aims

Outline syllabus

This is an indicative module outline only to give an indication of the sort of topics that may be covered. Actual sessions held may differ.

• Interest rates and discount rates.
• Equations of value and compound interest calculations.
• Discounted cash flow.
• Types of investment.
• Concept of arbitrage.
• Introduction to the term structure of interest rates.
• Stochastic interest rate models.

Learning outcomes

By the end of the module, students should be able to:

• be familiar with basic financial terminology and be able to understand the financial press.
• be able to carry out basic financial calculations.
• understand the basics of life tables

Indicative reading list

View reading list on Talis Aspire

Subject specific skills

• Demonstrate facility with rigorous actuarial and statistical methods.

• Evaluate, select and apply appropriate mathematical and/or actuarial techniques.

• Demonstrate knowledge of and facility with actuarial methods, both explicitly and by applying them to the solution of actuarial problems.

• Create structured and coherent arguments communicating them in written form. 

• Construct logical arguments with clear identification of assumptions and conclusions.

• Reason critically, carefully, and logically.

Transferable skills

• Problem solving: Use rational and logical reasoning to deduce appropriate and well-reasoned conclusions. Retain an open mind, optimistic of finding solutions, thinking laterally and creatively to look beyond the obvious. Know how to learn from failure.

• Self awareness: Reflect on learning, seeking feedback on and evaluating personal practices, strengths and opportunities for personal growth.

• Communication: Present arguments, knowledge and ideas, in a range of formats.

• Professionalism: Prepared to operate autonomously. Aware of how to be efficient and resilient. Manage priorities and time. Self-motivated, setting and achieving goals, prioritising tasks. Acknowledge and adhere to the requirements of the professional standards of the IFoA.