The course is aimed to provide a general education of the basic financial mathematics, with a particular concern to the analytic-methodological issues. The main topics are:
- Market structure: spot and forward prices;
- Term structures of interest rates;
- Simple and Compound Interest;
- Accumulation and Amount Functions;
- The Effective Rate of Interest;
- Present Value;
- Discount;
- Nominal Rates of Interest and Discount;
- Financial regimes: simple and compound;
- Force of Interest and Discount;
- Varying Interest;
- Fractional Periods;
- Determining Time Periods;
- Unknown Rate of Interest;
- Annuities: introduction and classification;
- Present Value of an Ordinary Simple Annuity;
- Annuities Due;
- Annuity Values on Any Date;
- Perpetuities;
- Unknown Time;
- Present Value and Unknown Rate of Interest (methods for its approximated calculus);
- Varying Interest;
- Amortization Schedules and Sinking Funds: Introduction;
- Amortization of a Debt;
- Sinking Funds;
- More Advanced Financial Analysis: Yield Curves;
- Duration;
- Immunization of investments in bonds;
- Duration of a coupon bond. Convexity;
- Bond portfolios.
