FINANCIAL MATHEMATICS

This course belongs to the characterizing teaching activities of the bachlor course "Economia e Commercio" in the curriculum Economics, Markets and Finance. In line with the educational objectives of the course, this activity aims to present the main financial mathematical tools necessary for the analysis of financial problems; particular attention will be devoted to operational abilities that enable to solve the main financial probems that arise in business and personal finance.

Knowledge and understanding skills.
Attendance and active participation in lectures, online activities, exercise sessions, group works, together with the individual study will allow the student to acquire the following knowledge and understanding skills:
- know and use the main concepts necessary to describe and understand main financing and investment instruments available to individuals and firms;
- know the mathematical techniques and methods useful to formalize and analyze financial situations.

Ability to apply knowledge and understanding.
Through the interaction with the instructors, the tutors, and peers and through the individual study the student acquires the following abilities:
- know how to use quantitative instruments to cope with standard as well as more complex financial operations;
- know how to choose the most appropriate technique in order to solve the concrete problem under analysis;
- know how to compare different financial opportunities.

Judgment skills, communication skills, learning skills.
Regarding the autonomy of judgment, communication skills and learning abilities, through the personal and group study of the concepts seen in class, the student will be able to:
- formulate rational justifications to the approach used to analyze financial problems and situations, understanding their relative strengths and weaknesses;
- know how to formulate and communicate an adequate analysis and financial interpretation of mathematical models and tools used.

Second- or later-year students cannot take any exam if they have ALR (Additional Learning Requirements) pending.
Prerequisites: Mathematics

- Time value of money and interest rates (Simple interest, discount interest, compound interest).
- Foreign currencies and exchange rates.
- Annuities and sinking funds, Mortgages, and amortization schemes.
- Fixed income securities. Valuation of bonds and elements of the term structure of interest rates.
- Duration and elements bond portfolio immunization.

1. S. Romagnoli, Mathematical Finance, a. Theory, b. Practice, Esculapio Economia 2015.
2. D.G. Luenberger, Investment Science, Oxford University Press, 2012 (part I).
3. Lecture notes.

Other references
T.J. Biehler, The mathematics of money, McGraw-Hill, 2008 (Chapters 1 to 5 and selected applications from part two).

Evaluation is based on a final written exam.

The exam is divided into two parts:
The first part consists of 3 exercises.
The second part consists of 2 open-answer questions.
They are used to verify the knowledge and skills related to the entire program.
The exam is evaluated on a 30-point basis. The final exam is unique and is considered passed with the achievement of 18 total points over 30.

scritto

The entire course covers 30 academic hours of teaching with traditional lectures. There are also 10 extra hours of exercise sessions.

Students are required to register for the course on the moodle platform of the university (moodle.unive.it).

Questo insegnamento tratta argomenti connessi alla macroarea "Capitale umano, salute, educazione" e concorre alla realizzazione dei relativi obiettivi ONU dell'Agenda 2030 per lo Sviluppo Sostenibile