Spring 2014
THE CHINESE UNIVERSITY OF HONG KONG
FINA2210 B/C Interest Theory and Finance
Assignment No. 3 (for Chapters 3, 4 and 5)
Deadline: 28 March 2014 (5:00pm Sharp)
1. You are given the followin
Spring 2014
THE CHINESE UNIVERSITY OF HONG KONG
FINA 2210 B/C Interest Theory and Finance
Assignment No. 1 (for Chapter 1)
Deadline: 7 February 2014 (5:00pm Sharp)
1. Assume that a(t) = ln(0.5t2 + e)
Basic stuff
= f (i ) =
i = f ( ) =
i = f (d ) =
d = f (i ) =
= f (d ) =
d = f ( ) =
Some combinations of basic equations
id =
11
=
di
i =
Nominal rates
1+ i =
im =
1 d =
dm =
Force of interest
t =
Basic stuff
= f (i ) =
1
d
i = f (d ) =
1 d
i
d = f (i ) =
1+ i
= f (d ) = 1 d
d = f ( ) = 1
1
1 +i
i = f ( ) =
Some combinations of basic equations
i d = id
11
=1
di
i = d
Nominal rates
m
i(m)
Exam FM Formula Summary
Version 2.01
no driver
11/14/2006
Introduction
Since ASM does not have a formula summary, I decided to compile one to use as I started working on
old test questions. In the int
Call and Put Options
Position
Long (Synthetic)
Forward
Bull Spread
Bear Spread
Ratio Spread
Collar
Straddle
Strangle
Written Straddle
Butterfly Spread
Asymmetric Butterfly
Spread
Reason for Taking
Pro
Financial Mathematics
December 16, 2013
1
1.1
The Measurement of Interest
Accumulation function
a(t) a(t 1)
a(t 1)
A(t) A(t 1)
it =
A(t 1)
A(t) = k a(t)
it =
Under simple interest
a(t) = 1 + it
i
it =
I.
Interest Rate Measurement:
Accumulation Function, a(t): Accumulated value @ time (t) of an original investment of $1 Amount Function, A(t): Accumulated value @ time (t) of an original investment
STA 4183 The Theory of Interest
Basic Formulas
Accumulation function
a(t),
a(0) = 1
Simple interest
a(t) = 1 + it
Amount function
A(t) = A(0) a(t)
Simple discount
d(t) = 1 - dt
Effective rate of inter
Exam FM/2 Interest Theory Formulas
by (/iropracy
This is a collaboration of formulas for the interest theory section of the SOA Exam FM / CAS Exam 2.
This study sheet is a free non-copyrighted documen
CLs Handy
Formula Sheet
(Useful formulas from Marcel Finans FM/2 Book)
Compiled by Charles Lee
8/19/2010
Interest
Interest
Simple
Compound
Discount
Simple
Compound
The Method of Equated Time
a(t)
Peri
SOCIETY OF ACTUARIES
EXAM FM
FINANCIAL MATHEMATICS
EXAM FM SAMPLE QUESTIONS
This page indicates changes made to Study Note FM-09-05.
January 14, 2014:
Questions and solutions 5860 were added.
Copyrigh
Spring 2017
THE CHINESE UNIVERSITY OF HONG KONG
FINA 2210 B/C Interest Theory and Finance
Assignment No. 1 (for Chapters 1 & 2)
Deadline: 20 February 2017 (5:00pm Sharp)
You MUST submit hardcopy of yo
Spring 2016
THE CHINESE UNIVERSITY OF HONG KONG
FINA 2210 C Interest Theory and Finance
Assignment No. 1 (for Chapters 1 & 2)
Deadline: 22 February 2016 (5:00pm Sharp)
You MUST submit hardcopy of your
Financial Mathematics ExamFebruary 2014
The Financial Mathematics exam is three-hour exam that consists of 35 multiple-choice questions and is
administered as a computer-based test. For additional det
I.
Introduction:
A derivative is a financial instrument that has a value determined by an underlying asset.
Uses of derivatives:
o Risk management
o Speculation on prices
o Reducing transaction cost
Spring 2014
THE CHINESE UNIVERSITY OF HONG KONG
FINA 2210 B/C Interest Theory and Finance
Assignment No. 2 (for Chapter 2 (Part A & B)
Deadline: February 28, 2014 (5:00pm Sharp)
1.
A family wishes to
Spring 2014
THE CHINESE UNIVERSITY OF HONG KONG
FINA2210 B/C Interest Theory and Finance
Assignment No. 4 (for Chapters 6, 7 and 8)
Deadline: 14 April 2014 (5:00pm Sharp)
* This is the LAST assignment
Period is the unit in which time is measured, e.g.
month, quarter, and year.
2
day,
Principal is the initial amount of money (capital) borrowed
or invested.
Interest is the compensation that a borr
Chapter 2 - PART A:
Basic Annuities
January 11, 2014
Chapter 2 (Part A): Basic Annuities
A. Introduction
1. Denition
An annuity is dened as a series of payments made at equal
intervals of time.
An a
Chapter 2 (Part B)
More General Annuities
January 17, 2014
Chapter 2 (Part B): More General Annuities
A. Payment period dierent from interest period
1. Payment period is longer than interest period
Il
Chapter 3
Spot Rates, Forward Rates and
the Term Structure
January 23, 2014
Chapter 3: Spot Rates, Forward Rates and the Term Structure
Learning Objectives
1. Spot rate of interest
2. Forward rate of
Chapter 5
Loans and Costs of Borrowing
February 19, 2014
Chapter 5: Loans and Costs of Borrowing
Learning Objectives
1. Loan balance: prospective method and retrospective method
2. Amortization schedu
Chapter 6
Bonds and Bond Pricing
March 9, 2014
Chapter 6: Bonds and Bond Pricing
Learning Objectives
1. Types, features and risks of bond investments
2. Formulas for pricing a bond
3. Construction of
Chapter 7
Bond Yields and the Term Structure
March 18, 2014
Chapter 7: Bond Yields and the Term Structure
Learning Objectives
1. Yield to maturity, yield to call and par yield
2. Realized compound yie