**Instructors**

Mr. Aaron Hillebrandt, FCAS, MAAA

Consulting Actuary

Pinnacle Actuarial Resources

2817 Reed Road, Suite 2

Bloomington, IL 61704

Telephone: 309-807-2300, Fax: 309-807-2301

E-mail: AHillebrandt@pinnacleactuaries.com

and

Dr.
Krzysztof Ostaszewski,
FSA, FSAS, CERA, CFA,
MAAA

Actuarial Program Director

Office: Stevenson Hall room 313G

Office telephone: 309-438-7226, Office fax: 309-438-5866

E-mail: krzysio@ilstu.edu

Tuesdays and Thursdays 3:00-4:50 p.m. (with a ten minute break), in Stevenson Hall, room 229.

Office hours will be held Tuesdays and Thursdays 2:00-2:50 p.m., in Stevenson Hall room 313G, by Dr. Krzysztof Ostaszewski. Please ask for an appointment at other times, appointments with Dr. Krzysztof Ostaszewski should be be scheduled at: http://krzysio.acuityscheduling.com.

**Textbooks**

Notes for all topics with practice exercises will be posted as links next to dates of classes, see below, in the schedule of classes. You may use this book:

*• Derivatives Markets, *Second Edition, by McDonald, R.L., Pearson Series in Finance, 2006,

or this book

*• Derivatives Markets, *Third Edition, by McDonald, R.L., Pearson Series in Finance, 2013,

but you are not required to. The publisher's site for the book is here.

**Objective**

The objective of this class is to help you learn about mathematical models utilized in financial economics.These actuarial models form a key part of modern actuarial science. We will cover the entire contents of the Course MFE/3F professional actuarial examination. Information about this examination can be found at: http://www.beanactuary.org/exams/preliminary/?fa=financial-economics-exam.

There will be a total of six tests. Any of the comprehensive tests (as indicated in the schedule) can count as a final. Because there will be so many opportunities for testing and only the best four test scores will affect the class grade, no make-up tests will be offered. The final will count as 40% of your grade, and the best two of the remaining tests will count as 30% of your grade each. You will also receive up to 10% extra credit for the best of the remaining tests. The grading scale for undergraduate students will be as follows: 90% or better -- A, 80% to 90% -- B, 70% to 80% -- C, 60% to 70% -- D, below 60% -- F. The grading scale for graduate students will be the same, but their score in the class will be multiplied by the factor of 0.9, to account for increased expectations of them, as they receive graduate credit for the class.

**Important dates**

Illinois State University withdrawal information for the Fall 2013 semester is given at this web site: http://www.registrar.ilstu.edu/registration/withdrawal/fall.shtml.

Disability concerns

Illinois State University provides a welcoming atmosphere for individuals with disabilities by assisting each in functioning independently within the University community and providing equal access and opportunity in accomplishing educational, professional and personal goals. Disability Concerns, a unit of the Student Affairs Division, is the designated office to provide approved accommodation services for students, faculty, staff, and guests with disabilities. Disability Concerns obtains and maintains documentation of disability, certifies eligibility for services, determines reasonable accommodations, and develops plans for providing such accommodations. This is accomplished in a confidential manner to ensure equal opportunity for participation in all courses, programs, activities and employment offered by Illinois State. Please contact the Disability Concerns in Fell Hall room 350, tel. 309-438-5853 (Voice), 309-438-8620 (TTY), web site: http://disabilityconcerns.illinoisstate.edu, if you have needs that can be accommodate by that office.

- Additional study material: Put-call parity charts.
- Video lecture on Parity and Other Option Relationships.