ETM2860 · Economic modelling 1

Overview

In this unit, you will be introduced to the foundational theories of portfolio management and the creation of asset models, which are crucial components for effective risk management within financial services firms. Building on the prerequisites of Risk and Survival Modelling, Time Series and Stochastic Processes, and Calculus I, this unit equips you with essential tools for rational economic decision-making and asset pricing. The curriculum emphasizes practical applications, focusing on portfolio management techniques and risk assessment within the dynamic context of financial services. This unit aims to prepare you for the complexities of evaluating investment opportunities, applying financial risk measurement tools, and utilizing asset pricing models to estimate expected returns and assess individual asset risks by providing you with a solid grounding in economic theories and modelling techniques. Upon unit completion, you will have acquired a good understanding of the theory and techniques related to portfolio management and the risk assessments, which serves as a critical step in developing analytical skills for roles in actuarial analytics and risk management, and provide sufficient expertise for use in various later units and the actuarial professional examinations.

Offerings

The Handbook publishes no offerings for this unit.

Assessment

The Handbook lists an examination for this unit.

Assessment details may change. Please refer to the assessment information in Moodle closer to the start of the teaching period.

Requisites

Learning outcomes

1. explain theories and modelling techniques used to explore, understand and evaluate rational economic decision making and asset pricing
2. apply a range of financial risk measurement tools to evaluate investment opportunities in the context of utility functions
3. apply the principles of asset pricing models to estimate expected returns and assess the risk of individual assets

Workload

Minimum total expected workload to achieve the learning outcomes for this unit is 144 hours per semester typically comprising a mixture of scheduled learning activities and independent study. Independent study may include associated readings, assessment and preparation for scheduled activities. You are expected to complete all pre-class activities prior to your scheduled class, and post-class activities should be completed after your scheduled class. Learning activities may include a combination of teacher directed, peer directed and online engagement activities.

Student experience, not official rules. Nothing here changes what the Handbook says.