Value, risk and return - three of the central concerns of finance - all derive from mathematical foundations. Mathematics describes the dynamics of financial markets, it determines the values and risk exposures of financial positions and it connects the performance of financial structures to those structures' constituents. In short, mathematics pervades finance.
Mathematics allows us to describe, understand, measure, manage and engineer financial products and positions for our benefit.
This workshop seeks to make the mathematics of finance accessible by presenting it in a framework now familiar to finance practitioners - that of spreadsheets.
Framing this workshop in a spreadsheet format gives the following benefits.
This course is aimed at those who wish to apply key mathematical concepts and principles to understanding and analysing financial products and positions.
This is an intermediate level course.
This is a two day course.
Participants should be able to use spreadsheet absolute and relative addressing (e.g. $B$5 / B5) and be able to enter mathematical formulae into cells [e.g. =1/(1+.04)^4]. Participants should understand and be able to apply the concepts of discounting, present and future value and simple and compound interest.
The course has a “hands-on” format. Each participant works with a laptop for the major part of the course on practical financial mathematics topics.
Following is an overview of this course's content.
The workshop begins by examining the following core mathematical functions and concepts often used in finance.
The mathematics of the preceding section is applied in order to model and work with the following finance concepts.
This section reviews spreadsheet tools and functions that are often applied in financial mathematics.
In this section the following classes of financial products are examined.
For these classes of products we show how mathematics can be used in