Learn how to apply mathematical concepts and techniques in finance through real-world case studies and hands-on exercises. Acquire the skills and knowledge to navigate the complex financial landscape and make informed decisions in this high-stakes field.
Math is a critical skill for any successful financial analyst. Much of the work entails evaluating capital projects and selecting investments. To carry out these tasks accurately, you must understand the mathematics behind time value of money problems. In this Math for Finance course, you will learn critical mathematical concepts required for a career in financial analysis, corporate finance, investment banking, risk management, private equity, financial planning and analysis, and many more. You will learn about the time value of money and why money is more valuable today than tomorrow. We also introduce the concept of interest rates and examine the premiums that compensate investors for bearing risk. By the end of the financial mathematics course, you will know how to solve time value of money problems in Excel for different frequencies of compounding. You will also learn to calculate and interpret the future and the present value of a single sum of money, an ordinary or annuity due, perpetuity, and a series of unequal cash flows. We explain the differences between the effective and annual interest rates, the importance of compounding frequency, and how it affects the future and the present value of our investments. Next, the finance mathematics course covers two of the most common metrics for estimating capital budgeting projects’ profitability: the Net Present Value (NPV) and the Internal Rate of Return (IRR). We contrast the two measures and identify problems associated with the IRR rule. Then, we introduce the most common investment and portfolio return measures: the Holding Period Return and the Money-Weighted and Time-Weighted Rate of Return. Our Math for Finance course also touches on several fixed income investment topics, such as bond valuation and yields. You will learn how to calculate the most common yield measures—current yield and yield to maturity. We also introduce the most important Excel functions that you need to calculate them. Lastly, we examine the different money market instruments and their specific yield measures, such as the money market, effective annual, and bond equivalent yields. Math for Finance is the must-have course for anyone looking to excel in finance. It covers key mathematical concepts and their real-world applications, equipping you with the knowledge to understand financial markets and make informed investment decisions. Whether you're a student or a seasoned professional, this course will give you a competitive edge. Enroll today and master the math behind financial markets.
Do you want to become a successful financial analyst? Math for Finance is the ultimate course for anyone looking to take their career to the next level. Most importantly, you will:
In the introductory section, we discuss the time value of money and the core principle of finance—money today is more valuable than money tomorrow. You will learn how to interpret interest rates and decompose them as the sum of a real risk-free rate and different risk premiums. Finally, we calculate the effective annual rate (EAR) by incorporating the effects of compounding.
In this section of the financial mathematics course, we examine the relationship between present and future value and learn how to move money through time. We discuss the importance of compounding frequency, how it affects the present and future value of our investments, and the different types of cash flow streams. Lastly, you will learn how to calculate the future and the present value of ordinary and annuity due and unequal cash flows.
In this core section of the Math for Finance course, you will learn to model and solve time value of money problems. We show you how to obtain the size of annuity payments manually and in Excel. You will learn how to calculate the number of years it takes to reach your financial goal and find investments' growth rates. At the end of this section, we examine the cash flow additivity principle.
Having covered interest rates, we can discuss several discounted cash flow applications. In this practical section, we introduce the Net Present Value and Internal Rate of Return techniques. They help us determine whether a project is feasible and advantageous from a financial perspective. Finally, you will learn how to choose the most profitable project when the two measures produce conflicting results.
This section of the finance mathematics course is dedicated to the different return measures. First, we examine the holding period yield, the logarithmic return, and the differences between them. Then, we explore the two most common portfolio return measurements: the Money-Weighted Rate of Return and the Time-Weighted Rate of Return.
In the final section of the Math for Finance course, we discuss bond pricing and yields. You will learn how to calculate yield measures, such as current yield and yield to maturity, and determine whether a bond trades at a discount, par, or premium. At the end of this section, we examine the short-term debt market. You will learn how to calculate different money market yields, such as the bank discount, effective annual, and money market yields.
Student feedback
“They say math is the secret to understanding the world. And while it may not be the answer to all ontological questions, it certainly is the key to being a successful financial analyst.”
Ned Krastev
CEO at 365 Data Science
Math for Finance
with Ned Krastev
