VMS

Detail Model

MTH 4500 - Intro Financial Math

Undergraduate | 4 Credits | 4 Hours
This course is an introduction to mathematical methods used in finance and their applications. No prior knowledge of finance is assumed. Basic financial instruments such as forward and futures contracts, options, and bonds are introduced. The course is built around three major themes: (i) risk-free assets and the term structure of interest rates; (ii) Markowitz portfolio optimization and the Capital Asset Pricing Model; (iii) No Arbitrage principle and its applications including pricing and hedging of derivative securities in the context of the multi-period binomial model and its continuous analog, the BlackScholes model. Students are expected to use their knowledge of probability, single and multivariable calculus, and basic linear algebra to master mathematical finance theories and apply them in real world situations.
Prerequisite: MTH 3020 or MTH 3030 or MTH 3050 and MTH 3120 or 4120