The aim of this module is to provide a grounding in the principles of modelling as applied to actuarial work – focusing particularly on stochastic asset liability models. These skills are also required to communicate with other financial professionals and to critically evaluate modern financial theories.
Indicative topics covered by the module include theories of financial market behaviour, measures of investment risk, stochastic investment return models, asset valuations, and liability valuations.
The additional 4 contact hours for level 7 students will be devoted to applications of the principles of financial economics and asset and liability modelling to complex financial instruments.
This module will cover a number of syllabus items set out in Subject CM2 – Actuarial Mathematics published by the Institute and Faculty of Actuaries.
Total contact hours: 40
Private study hours: 110
Total study hours: 150
Method of assessment
Main Assessment Methods
Examination 70%, Coursework 30%
David Hillier, Mark Grinblatt, Sheridan Titman, 2012. Financial markets and corporate strategy, McGraw-Hill Higher Education, London.
Martin Baxter, Andrew Rennie, 1996. Financial Calculus: An Introduction to Derivative Pricing, Cambridge University Press, Cambridge.
Students on the BSc Actuarial Science programmes are provided with the study notes published by the Actuarial Education Company for Subject CM2 – Actuarial Mathematics 2.
See the library reading list for this module (Canterbury)
The intended subject specific learning outcomes. On successfully completing the module students will be able to:
1 describe, interpret and discuss key aspects and concepts involved in financial economics, and asset and liability models;
2 demonstrate the capability to deploy established approaches accurately to analyse and solve complex problems using a high level of skill in calculation and manipulation
of financial economics, and asset and liability models;
3 demonstrate an appreciation of recent developments in financial economics and modelling and the links between the theory of these topics and their practical application.
4 apply the principles of financial economics and asset and liability modelling to complex financial instruments.
The intended generic learning outcomes. On successfully completing the module students will be able to:
1 use a logical mathematical approach to solve complex problems;
2 solve problems and communicate in writing effectively to both a technical and non-technical audience;
3 manage their time and work independently;
4 demonstrate a high level of higher order numeracy and communication skills.
Back to top
Credit level 7. Undergraduate or postgraduate masters level module.
- ECTS credits are recognised throughout the EU and allow you to transfer credit easily from one university to another.
- The named convenor is the convenor for the current academic session.
University of Kent makes every effort to ensure that module information is accurate for the relevant academic session and to provide educational services as described. However, courses, services and other matters may be subject to change. Please read our full disclaimer.