maths in a Finance major...? (1 Viewer)

[filip23]

just wondering...exactly what kind of mathematics is involved when undertaking a Finance major?...and general level of difficulty? i've heard that Accounting is much easier?

 

[Shadowdude]

Maths in Finance is very easy. It's like 2u level.

 

[filip23]

thanks for your reply. could you be more specific?

 

[Shadowdude]

Can you plug in numbers into formulas? If so, then you're pretty much set for Finance maths.


In first year and even second year, you just go through pricing bonds which is just "plug in these numbers into these given formulas" and other inane whatnot.

 

[Trebla]

Most of the maths in finance is 2U/3U level + statistics. If you understood basic calculus, series, probability and linear functions in high school then you should be fine. A lot of the new stuff like linear algebra/matrices, partial derivatives, optimisation and statistics will also be covered during the lectures but these new concepts are based on the existing concepts from high school.

Most of the time you are given the formulas that lecturers seem to pull out of nowhere to substitute in. However, keep in mind that there is a very strong mathematical framework in which these formulas are derived from which most lecturers do not cover. In essence, the finance you do at undergraduate level is a watered down version (i.e. most of the difficult mathematics removed) of the real finance in the academic world (which has very complex mathematical and statistical concepts).

 

[seremify007]

Depends on where you take your finance degree- if you go down the quantitative or qualitative subjects route. I know I'm rubbish at maths and hence went down the latter as I struggled with statistics/data analysis in 1st year. I wouldn't go so far to say that maths is easy in finance because there is an appreciation of how things interact or are derived which is assumed rather than taught. The guys above are right in that you are given a formula to plug numbers into for first/second year normal financey subjects (portfolio management, wealth related, bond pricing, etc)- but if you don't appreciate how the variables interact or how to challenge the data you are using, you'll probably find it a bit hard once you get to the harder subjects which try to bring it all together (i.e. the formulas, the statistical analysis, etc).