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ST334 Actuarial Methods

Lecturer(s): Dr Gechun Liang

Restrictions: A previous restriction where students were not permitted to take this module as an unusual option has been removed. Students are now permitted to take this module if they have permission from all relevant parties via an Unusual Option form. Data Science students should note that they are not likely to be granted permission by the course director.

Prerequisite(s): ST218/219 Mathematical Statistics A&B

This module runs in Term 1.

Commitment: This will be a reading course based on handouts; there will be a one two-hour session every week.

Content:

  • 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.

Aims: To cover the syllabus for Actuarial CT1

Objectives: At the end of the course, students will:

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

Leads to: Knowledge of basic financial terminology necessary for several other modules.

Assessment: 3 one-hour class tests (each 15%) with 2-hour examination in January (55%).

Deadline: Class Test 1: week 4, Class Test 2: week 7 and Class Test 3: week 10.

Feedback: Feedback on class tests will be returned after 2 weeks, following each test. The results of the January examination will be available in week 10 of term 2.

Examination Period: January