Students

ACST8081 – Mathematics of Finance

2021 – Session 2, Weekday attendance, North Ryde

Session 2 Learning and Teaching Update

The decision has been made to conduct study online for the remainder of Session 2 for all units WITHOUT mandatory on-campus learning activities. Exams for Session 2 will also be online where possible to do so.

This is due to the extension of the lockdown orders and to provide certainty around arrangements for the remainder of Session 2. We hope to return to campus beyond Session 2 as soon as it is safe and appropriate to do so.

Some classes/teaching activities cannot be moved online and must be taught on campus. You should already know if you are in one of these classes/teaching activities and your unit convenor will provide you with more information via iLearn. If you want to confirm, see the list of units with mandatory on-campus classes/teaching activities.

Visit the MQ COVID-19 information page for more detail.

General Information

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Unit convenor and teaching staff Unit convenor and teaching staff Unit Convenor
Yanlin Shi
Credit points Credit points
10
Prerequisites Prerequisites
Admission to MActPrac
Corequisites Corequisites
Co-badged status Co-badged status
Unit description Unit description

This unit begins with coverage of the basics of data analysis and modelling. It continues with a rigorous mathematical development of compound interest theory, using calculus where appropriate, applying the theory to more complex financial problems. Topics include the force of interest and its relationship to interest rates, inflation and capital gains tax, discrete and continuous term certain annuities, project appraisal, loans, bonds, yield curves, matching and immunisation and the definitions of various insurance and annuity contracts. Students will be required to use an Excel spreadsheet to solve problems throughout the unit. The concepts developed in this unit are required in several subsequent units in the actuarial degree. Students gaining a credit average in both ACST8081 and ACST8082 (minimum mark of 60 on both units) will satisfy the requirements for exemption from the professional subject CM1 of the Actuaries Institute.

Important Academic Dates

Information about important academic dates including deadlines for withdrawing from units are available at https://students.mq.edu.au/important-dates

Learning Outcomes

On successful completion of this unit, you will be able to:

  • ULO1: Demonstrate an understanding of compound interest theory.
  • ULO2: Identify and describe various types of annuities and apply them to solve complex financial problems involving annuities.
  • ULO3: Apply the compound interest theory to a range of practical problems in finance, including loans, analysis of investment projects, valuation of fixed interest securities, yield curves, the no-arbitrage pricing method, forward contracts and immunisation theory.
  • ULO4: Describe the basic principles of actuarial modelling.
  • ULO5: Define simple life table functions and various assurance and annuity contracts.
  • ULO6: Explain how the compound interest theory can be applied to a wide range of practical problems in financial mathematics.

General Assessment Information

Assessment criteria for all assessment tasks will be provided on the unit iLearn site.

It is the responsibility of students to view their marks for each within-session-assessment on iLearn within 20 days of posting. If there are any discrepancies, students must contact the unit convenor immediately. Failure to do so will mean that queries received after the release of final results regarding assessment tasks (not including the final exam mark) will not be addressed.

Late submissions of assessments

Sometimes unavoidable circumstances occur that might prevent you from submitting an assessment on time and, in that case, you may be eligible to lodge a Special Consideration request.

Unless a Special Consideration request has been submitted and approved, please note that no extensions to assessment deadlines will be granted. Assessments that are submitted late will attract a late penalty:

  1. There will be a deduction of 10% of the total available marks for each 24 hour period or part thereof that the submission is late.
  2. No assessment will be accepted more than 72 hours after the original due date and time (incl. weekends).
  3. No late submissions will be accepted for timed assessments (e.g., quizzes, online tests) or for tasks with a weighting of 10% or less.

Assessment Tasks

Name Weighting Hurdle Due
Class Test 20% No Week 6
Assignment 20% No Week 10
Final Exam 60% No University Examination Period

Class Test

Assessment Type 1: Quiz/Test
Indicative Time on Task 2: 10 hours
Due: Week 6
Weighting: 20%

The test will be approximately 90 minutes, to be held during class time.


On successful completion you will be able to:
  • Demonstrate an understanding of compound interest theory.
  • Identify and describe various types of annuities and apply them to solve complex financial problems involving annuities.
  • Apply the compound interest theory to a range of practical problems in finance, including loans, analysis of investment projects, valuation of fixed interest securities, yield curves, the no-arbitrage pricing method, forward contracts and immunisation theory.
  • Describe the basic principles of actuarial modelling.

Assignment

Assessment Type 1: Quantitative analysis task
Indicative Time on Task 2: 20 hours
Due: Week 10
Weighting: 20%

This is an individual assignment which focuses on problem solving using Excel spreadsheet.


On successful completion you will be able to:
  • Demonstrate an understanding of compound interest theory.
  • Identify and describe various types of annuities and apply them to solve complex financial problems involving annuities.
  • Apply the compound interest theory to a range of practical problems in finance, including loans, analysis of investment projects, valuation of fixed interest securities, yield curves, the no-arbitrage pricing method, forward contracts and immunisation theory.
  • Explain how the compound interest theory can be applied to a wide range of practical problems in financial mathematics.

Final Exam

Assessment Type 1: Examination
Indicative Time on Task 2: 28 hours
Due: University Examination Period
Weighting: 60%

The final examination will be closed book, a three-hour written paper with ten minutes reading time, to be held during the University Examination period.


On successful completion you will be able to:
  • Demonstrate an understanding of compound interest theory.
  • Identify and describe various types of annuities and apply them to solve complex financial problems involving annuities.
  • Apply the compound interest theory to a range of practical problems in finance, including loans, analysis of investment projects, valuation of fixed interest securities, yield curves, the no-arbitrage pricing method, forward contracts and immunisation theory.
  • Describe the basic principles of actuarial modelling.
  • Define simple life table functions and various assurance and annuity contracts.
  • Explain how the compound interest theory can be applied to a wide range of practical problems in financial mathematics.

1 If you need help with your assignment, please contact:

  • the academic teaching staff in your unit for guidance in understanding or completing this type of assessment
  • the Learning Skills Unit for academic skills support.

2 Indicative time-on-task is an estimate of the time required for completion of the assessment task and is subject to individual variation

Delivery and Resources

The timetable for classes can be found on the University website at:

https://timetables.mq.edu.au/2021/

There is no required textbook.

Unit materials are available for download from iLearn.

Students will be required to use iLearn, Excel and a non-programmable calculator

Unit Schedule

Please refer to iLearn

Policies and Procedures

Macquarie University policies and procedures are accessible from Policy Central (https://staff.mq.edu.au/work/strategy-planning-and-governance/university-policies-and-procedures/policy-central). Students should be aware of the following policies in particular with regard to Learning and Teaching:

Students seeking more policy resources can visit the Student Policy Gateway (https://students.mq.edu.au/support/study/student-policy-gateway). It is your one-stop-shop for the key policies you need to know about throughout your undergraduate student journey.

If you would like to see all the policies relevant to Learning and Teaching visit Policy Central (https://staff.mq.edu.au/work/strategy-planning-and-governance/university-policies-and-procedures/policy-central).

Student Code of Conduct

Macquarie University students have a responsibility to be familiar with the Student Code of Conduct: https://students.mq.edu.au/admin/other-resources/student-conduct

Results

Results published on platform other than eStudent, (eg. iLearn, Coursera etc.) or released directly by your Unit Convenor, are not confirmed as they are subject to final approval by the University. Once approved, final results will be sent to your student email address and will be made available in eStudent. For more information visit ask.mq.edu.au or if you are a Global MBA student contact globalmba.support@mq.edu.au

Student Support

Macquarie University provides a range of support services for students. For details, visit http://students.mq.edu.au/support/

Learning Skills

Learning Skills (mq.edu.au/learningskills) provides academic writing resources and study strategies to help you improve your marks and take control of your study.

The Library provides online and face to face support to help you find and use relevant information resources. 

Student Enquiry Service

For all student enquiries, visit Student Connect at ask.mq.edu.au

If you are a Global MBA student contact globalmba.support@mq.edu.au

Equity Support

Students with a disability are encouraged to contact the Disability Service who can provide appropriate help with any issues that arise during their studies.

IT Help

For help with University computer systems and technology, visit http://www.mq.edu.au/about_us/offices_and_units/information_technology/help/

When using the University's IT, you must adhere to the Acceptable Use of IT Resources Policy. The policy applies to all who connect to the MQ network including students.