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ACSC71-201: Financial Mathematics

Description

This subject offers a foundation in compound interest theory which underpins a number of common financial calculations.  This theoretical knowledge is supplemented with application to a variety of valuation and investment decisions. An introduction to simple stochastic models is also provided.

Subject details

Type: Postgraduate Subject
Code: ACSC71-201
EFTSL: 0.125
Faculty: Bond Business School
Semesters offered:
  • January 2023 [Standard Offering]
Credit: 10
Study areas:
  • Actuarial Science and Data Analytics
Subject fees:
  • Commencing in 2022: $5,310.00
  • Commencing in 2023: $5,450.00
  • Commencing in 2022: $5,710.00
  • Commencing in 2023: $5,860.00

Learning outcomes

  1. Use discounted cash flow techniques to calculate home loan repayment schedule, perform project appraisal and determine capital budgeting requirements.
  2. Explain the investment and risk characteristics of a variety of investment assets.
  3. Demonstrate an understanding of the term structure of interest rates, the concept of spot rate, forward rate, duration of a series of cash flows, and immunisation.
  4. Calculate the delivery price and the arbitrage-free value of a forward contract.
  5. Apply probability rules and concepts relating to discrete and continuous random variables. Demonstrate an understanding of simple stochastic models for investment returns.

Enrolment requirements

Requisites:

Nil

Assumed knowledge:

Assumed knowledge is the minimum level of knowledge of a subject area that students are assumed to have acquired through previous study. It is the responsibility of students to ensure they meet the assumed knowledge expectations of the subject. Students who do not possess this prior knowledge are strongly recommended against enrolling and do so at their own risk. No concessions will be made for students’ lack of prior knowledge.

Possess demonstratable knowledge in elementary probability theory, statistics, elementary calculus and linear algebra to the level of a unit such as STAT11-112 Quantitative Methods.

Restrictions:

Subject dates

  • Standard Offering
    Enrolment opens: 13/11/2022
    Semester start: 16/01/2023
    Subject start: 16/01/2023
    Cancellation 1: 30/01/2023
    Cancellation 2: 06/02/2023
    Last enrolment: 29/01/2023
    Withdraw - Financial: 11/02/2023
    Withdraw - Academic: 04/03/2023
    Teaching census: 10/02/2023
Standard Offering
Enrolment opens: 13/11/2022
Semester start: 16/01/2023
Subject start: 16/01/2023
Cancellation 1: 30/01/2023
Cancellation 2: 06/02/2023
Last enrolment: 29/01/2023
Withdraw - Financial: 11/02/2023
Withdraw - Academic: 04/03/2023
Teaching census: 10/02/2023