Introduction To Mathematical Software
- Sciences
- 200 level
- 2 credit units
- 170 pages
- 11 units
This course introduces students to mathematical software used in financial problem-solving. It covers MATLAB, MAPLE, and MS Excel, emphasizing their applications in financial mathematics. Students will learn to use these tools for calculations, simulations, and data analysis. The course aims to equip learners with practical skills to handle financial computations efficiently and effectively, bridging the gap between theoretical concepts and real-world applications in finance.
About this course
- Difficulty
- Intermediate
- Study hours
- 150 hours
- Maths
- Intermediate
- Content
- Theoretical, practical, problem solving
- Practical work
- Yes
- Assignments
- Tutor marked assignments
- Final examination
What you'll read
The real module and unit structure of FMT206, taken from the course material NOUN publishes.
One paragraph, so you can see how it reads
FMT206 · UNIT TWO
It is also a programming language, and is one of the easiest programming languages for writing mathematical programs. MATLAB also has some tool boxes useful for signal processing, image processing, optimization, etc.
What you should be able to do
- Explain the concepts of software used in financial mathematics
- Use MATLAB to solve financial problems
- Use MAPLE to solve financial problems
- Use MS Excel to solve financial problems
- Apply mathematical software to model financial scenarios
What it prepares you for
- Financial Analyst
- Quantitative Analyst
- Investment Banker
- Actuary
- Financial Modeler
- Banking
- Investment Management
- Insurance
- Corporate Finance
- FinTech
- MATLAB
- MAPLE
- Microsoft Excel
Where it gets hard
The units students slow down on, and what makes each one heavy.
- Module 1: Introduction to Mathematical Softwares
Unit 1: Geometric Brownian Motion
Requires understanding of stochastic processes and familiarity with statistical distributions.
- Module 1: Introduction to Mathematical Softwares
Unit 3: The Black–Scholes formula
Involves complex calculations and understanding of financial instruments.
A suggested way through it
13 weeks, about 53 hours in total. Yours will differ.
- Week 1Module 1: Introduction to Mathematical Softwares
Unit 1: What is MATLAB? · 2 hours
Read the introduction to MATLAB. Understand the MATLAB desktop environment. Practice starting and quitting MATLAB.
Unit 1: A model of price evolution · 2 hours
Study the model of price evolution. Understand the assumptions behind the model. Simulate the pricing process using MATLAB.
- Week 2Module 1: Introduction to Mathematical Softwares
Unit 1: Central Limit Theorem · 2 hours
Understand the Central Limit Theorem. Explore the example with Bernoulli random variables. Use MATLAB to illustrate the Central Limit Theorem.
Unit 1: Geometric Brownian Motion · 2 hours
Study Geometric Brownian Motion. Understand the model of price evolution in continuous time. Simulate Geometric Brownian Motion using MATLAB.
- Week 3Module 1: Introduction to Mathematical Softwares
Unit 2: Elementary financial calculations · 3 hours
Review the concept of principal and interest rates. Understand different compound interests. Calculate effective annual interest rate.
Unit 2: Interest rates · 3 hours
Use the interest_rate program to calculate different compound interests. Analyze the graphs generated by the program. Solve exercises on effective annual rate.
- Week 4Module 1: Introduction to Mathematical Softwares
Unit 2: Present value analysis · 3 hours
Understand the concept of present value analysis. Calculate the present value of simple and complicated cash flows. Compare different cash flows using present value.
- Week 5Module 1: Introduction to Mathematical Softwares
Unit 3: Rate of return · 4 hours
Use the present_value program to calculate present value. Solve problems involving fixed and varying cash flows. Analyze the examples from Table 4 and Table 5.
- Week 6Module 1: Introduction to Mathematical Softwares
Unit 3: Pricing via arbitrage · 4 hours
Understand the concept of rate of return. Calculate the rate of return for different cash flows. Use the ror program to solve problems.
- Week 7Module 1: Introduction to Mathematical Softwares
Unit 3: The multi-period binomial model · 4 hours
Study the one-period binomial model. Understand the concept of arbitrage. Calculate the no-arbitrage price of an option.
- Week 8Module 1: Introduction to Mathematical Softwares
Unit 3: The Black–Scholes formula · 4 hours
Understand the multi-period binomial model. Approximate geometric Brownian motion. Calculate the risk-neutral price of an option.
- Week 9Module 1: Introduction to Mathematical Softwares
Unit 4: Overcoming limitations Using MATLAB · 4 hours
Understand the Black-Scholes formula. Calculate the value of European call and put options. Use the black_scholes program.
- Week 10Module 2: Introduction to Financial Mathematics Using Maple
Unit 1: Introduction · 4 hours
Learn to find Present Value of a long cash flow. Learn to find rate of return of a long cash flow. The program mbm.
- Week 11Module 2: Introduction to Financial Mathematics Using Maple
Unit 2: The use of Maple for 2D and 3D · 4 hours
Understand Maple environment. Know how to start the Standard Document Interface. Understand how to enter commands and mathematical expressions in Maple.
- Week 12Module 3: Introduction to Financial Mathematics Using Excel
Unit 1 : Writing Formulas · 4 hours
The use of the Maple Software for 2D and 3D graphics. Creation of Plots in Maple. Interactive Plot Builder.
- Week 13Module 3: Introduction to Financial Mathematics Using Excel
Unit 2 : Copying/Cutting and Pasting Formulae · 4 hours
Copying and Pasting Formulae. Pasting Special. Inserting Functions.
Preparing for the exam
- Practice solving financial problems using MATLAB, MAPLE, and MS Excel
- Focus on understanding the underlying mathematical concepts
- Review the examples and exercises in the course material
- Create summary sheets for key formulas and functions
- Practice with past exam papers to get familiar with the exam format
Questions students ask about this course
What is FMT206 about?
This course introduces students to mathematical software used in financial problem-solving. It covers MATLAB, MAPLE, and MS Excel, emphasizing their applications in financial mathematics. Students will learn to use these tools for calculations, simulations, and data analysis. The course aims to equip learners with practical skills to handle financial computations efficiently and effectively, bridging the gap between theoretical concepts and real-world applications in finance.
How many units does FMT206 have?
FMT206, Introduction To Mathematical Software, has 11 units across 3 modules, over 170 pages of course material. You can read it one unit at a time.
How many credit units is FMT206?
FMT206 carries 2 credit units, at 200 level in Sciences.
Is FMT206 hard?
FMT206 is rated intermediate level, with intermediate mathematical content. It is mostly theoretical, practical and problem solving work, and it has a practical component.
How long does FMT206 take to study?
About 150 hours of study, spread across its 11 units.
How is FMT206 assessed?
FMT206 is assessed by assignments, tutor marked assignments and final examination.
What can I do with FMT206?
Financial Analyst, Quantitative Analyst, Investment Banker, Actuary and Financial Modeler.