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Business The Truth about Actuarial Science, It is not only about the Math

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LightningFist
post Aug 7 2011, 02:47 PM

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QUOTE(Angel01 @ Aug 4 2011, 04:07 PM)
I got a scholarship to study Actuarial Science in University of Southampton, is that a good university for as?
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Did you get a full scholarship with 3 years tuition + accommodation?

Southampton is good and reputable enough, I suppose. My teacher went to Southampton (grad school) before getting a PhD from UPenn. Competition in the UK would be LSE and Warwick.
LightningFist
post Aug 7 2011, 03:43 PM

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Yeah, there have been nice things said about HW. However, as is the norm with Scottish schools, a BSc takes 4 years to complete - though you can easily skip to the second year with good pre-u results, you're basically missing the first year's courses. I'm not sure how that works out in terms of exemptions, but that aside it might even appeal to some - that you can do a 4 year degree in 3 years and it'd still be equivalent to those 3 year degrees offered by the likes of Soton. On the other hand, 4 years could get you an Master's degree in the UK or an Honours degree in Australia (which is almost like an alternative version of a Master's degree).
LightningFist
post Aug 8 2011, 02:44 PM

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A number of people in the Actuarial profession also come from Oxbridge. As it stands Oxbridge offers a total of 0 exemptions from Actuarial CT or CA exams by undergraduate study. Despite this nearly everyone would be in agreement as to Oxbridge's status as being amongst the top in most areas of study (including Mathematics).
LightningFist
post Aug 22 2011, 02:36 PM

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QUOTE(Angel01 @ Aug 18 2011, 03:20 PM)
by the way, does anyone know the grading system in uk?

In malaysia we are still having CGPA and stuff...
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There are the classes, of course (firsts, 2:1s etc).

There is probably also a % score for each "module" or "unit". Of course these vary with subject and school.
LightningFist
post Sep 21 2011, 11:50 PM

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USA, Canada.
LightningFist
post Mar 28 2012, 06:29 AM

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QUOTE(meishien5602 @ Feb 3 2012, 06:52 PM)
So what course should I take in order to go into Investment Banking?
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Finance. Either Capital Markets or Quantitative Finance, or both. In any case you should study the fundamentals (Corporate Finance, Derivatives, Capital and Debt Markets, Money Markets, Investment and Portfolio Management, Valuation etc).

Economics. Traditional Economics is fine, loads of people study that. But some Finance specialisation or classes would be helpful. Financial Economics in particular would be nice, and more Econometrics.

Some come from Accounting or Actuarial backgrounds. In IB Accounting knowledge is useful (financial analysis, balance sheets etc) but they aren't Accounting firms - they are bankers, and they use Finance knowledge... a lot of these fields (Business, Management, Commerce, Finance, Economics, Accounting) have theory or conceptual overlap. Some Actuarial students have almost the same thing as Finance students anyway, on top of their Actuarial knowledge.

Law.

Business or Management (not Human Resources).

Computer Science or Computer Engineering.

Engineering.

Physics.

Mathematics, Statistics, Operational Research, Mathematical Finance, Mathematical Economics. Yes, a lot of this may be highly theoretical (as opposed to Computational Finance) but that doesn't mean they won't hire you if you're good. Besides Finance starts from theory and anything used in industry is just an extension of such theory.

Obviously for those Science courses you'll need to demonstrate some strong interest in Finance in addition to high ability/interest in Maths.

In almost all of these (except Finance/Actuarial) I suspect most graduates would have not much Finance knowledge. This is not an issue if you're new, after all even Language graduates are hired (they obviously come from top schools like Cambridge), because IB is about straddling clients and Finance. Obviously there would be a degree of training.
LightningFist
post Mar 29 2012, 09:12 PM

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QUOTE(justastudent @ Mar 29 2012, 08:24 PM)
hey, um... i'm currently taking up my A-levels now and the subjects are maths, further maths and physics.

i really like maths a lot and also statistics. that's why i had always wanted to pursue a degree in actuarial science.

however, after looking at this post, i started to wonder. i'm not sure whether should i go for actuarial science or statistics or just mathematics.

some help please?
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Do you like Finance? Things like Investment, Stocks, Options, Swaps, Currencies, Rates? Because you could get into that from Act Sci, it doesn't have to be pricing life insurance, general, reinsurance, or valuation. Act Sci also has a small element of Economics and Accounting (only the basics). So you pretty much study the fundamentals of Business/Commerce. Finance and Investment, Pensions, Life Insurance, Healthcare Insurance, General Insurance, and Enterprise Risk Management are pretty much the practice areas, if you do not go into banking.

Maths degree probably has a significant component of Statistics.

Statistics degree would be closer to an Actuarial degree more than Maths. But an Actuarial degree uses Statistics with a focus on insurance, investment, and risk. Statistics alone just has non-specific topics, like Maths. Different from Applied Mathematics, Mathematical Finance, Mathematical Economics, Maths and Stats for Finance, Computational Finance, Quantitative Finance etc.

What you probably realise that all of these can eventually lead to the same thing if you want it to, except studying Act Sci may lead to exemptions, and Maths or Stats are not applied into any specific field. Mathematicians and Statisticians are often employed as quants or financial engineers. Not having the Finance knowledge is not an issue, being able to absorb it later on is enough.




LightningFist
post Mar 29 2012, 09:43 PM

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QUOTE(justastudent @ Mar 29 2012, 09:18 PM)
um... im not really exposed to the finance so i couldnt say i like it or not.

like you said, Act. Sci. may lead to exemptions, does that means that i can have a few exams down by the time i graduated from uni?
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Yeah. Irish schools give out the most, because they may exceed the CTs (or Part I) to CAs - probably means their degrees are most Actuarial.

Australian schools (all 5 except Monash) have the full 8 CTs.

British schools sometimes have the full 8, or very very few. Big schools like LSE and Warwick only have 7.

British system -> you can even get ST exemptions after CAs

Australian system -> Part I = CTs, Part II can be done by studying at a couple unis, Part III is self-done, like British SAs


Just look at Maths degrees, and Stats and Actuarial degrees. Then look at the individual subjects or classes they do. Maybe Maths will have Differential Geometry and Topology, Mechanics etc, Actuarial will have Finance, Applied Statistics. Statistics is common to both but again, the difference will be the application.
LightningFist
post Mar 30 2012, 05:23 AM

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[quote=justastudent,Mar 29 2012, 10:15 PM]
so u mean if i study in ANU or Melbourne University, i can have exemptions for the full 8 CTs? how bout the VEEs? is it covered as well?

btw, i like pure maths more than mechanics or stuffs like that. do u think it's suitable for me to take actuarial science? or should i go for maths instead?

thanks for answering me (= smile.gif


Added on March 29, 2012, 10:49 pm
[QUOTE]
btw, like what u said above, is the format the same for SOA, FIA and IAA?
is part III the part to be done for me to be a new fellow or just a new associate?
and which is part II?

sorry and thanks for spending ur time to answer my questions haha
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[/quote]

You'll have to look it up. SOA is different from the UK institute, IAA only shares the CTs.

People doing a Maths degree would probably say the Maths in Act Sci is nothing... but it could be completely true, Act Sci is not a study of Maths. It is Insurance Maths, incorporating Financial Maths, Probability and Statistics, with basic principles of Economics. When you are just deriving formulas it's going to feel like Maths, but all you're doing is using series and calculus... there's no trigonometry, geometry or whatever.
LightningFist
post Mar 30 2012, 09:27 AM

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QUOTE(RyukA @ Mar 30 2012, 07:40 AM)
some minor corrections,

In actuarial, You will probably have to deal with all sorts of math a statistician will have to deal with,
common calculus & limiting distributions. Financial math for premium pricing, Generalised linear models &
mathematical statistics most of the time, sometimes Geometry & trigo, when you are fitting models
with (sin, cos, characteristics) or using certain algorithm when running simulations.
But dont worry, you dont do those everyday, Calculus? yes.

The building blocks of Actuarial Science, is reasonable, logical and fluent, with introductory economics,
some understanding of mechanism in finance. Although the statistics part is rather abstract at first, but ease up as you go on.
Insurance math stuff, is not abstract, just you know where you start, where to end, but there's a huge drama in between
the calculation to get there.

Math degree (I am assuming pure math, which is also whats special bout math anyway) mostly
give you deeper understanding on "stuff you dont really directly need in applied math" (if you are gonna work in some
boring corporation someday). You go deeper into fundamental principles of everything, learn techniques of proof,
bunch and bunch of abstract concept (not really tedious, but if you dont know it, you probably dont even know how to start).
I am not sure bout others, as I just do probability & measure theory. But can expect similar structure for all other pure math courses.
Well it also depends on the University, how theoretical or applied they want most math courses to be.

PS: Pre-U and high school math hardly tell anything. I have bunch of friends with 3A's struggle in 1st year pure math course.
And some of my 3rd yr math classmates hardly reach a TER of 82.
If you like to deal with numbers, stick with Actuarial, finance, stat, engineering. Or math will make your life miserable.

here's a small example of how both are different:

Actuarial Sci.
Here's f(x) a probability density function that describes
automobile claim, X. While here's f(y) another Prob. density function
to describe the similar automobile claim, X.
Provided is 120 claim size data that are assumed to be independent.
Run a suitable test to decide which model fits the claim distribution more adequate. Explain.

Math
Using similar argument in Axiom of Choice,
Prove or disprove that there exist a probability measure Q(x), from Powerset(Real) -> [0,1] such that
F(x) := Q((-inf,x]) is a continous function.
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My only consolation is that I won't do Advanced Derivatives Pricing?
LightningFist
post Mar 30 2012, 05:32 PM

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QUOTE(justastudent @ Mar 30 2012, 05:24 PM)
ok guys.... i'm still lost lol
so basically, i study 3/4 years for my degree (if i'm taking up actuarial science) and while i am studying, i pass my professional papers as long as i do good in my exams to get exemptions.
then after, i start working and finish up my professional papers.
is this true?

can someone tell me a little bout finance for actuarial science 'cause i have no idea what is it like at all... =.=
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http://en.wikipedia.org/wiki/Finance

Finance in Act Sci is no different from Finance itself.

But it is not "Finance" in the context of the Finance Departments of some companies, which do accounting and whatever. Finance can be budgeting, valuation, asset and liability matching, investment, risk management etc. That's why everyone doing Finance or Actuarial is supposed to have at least a single class of Accounting - to learn Accounting basics like balance sheets, financial analysis ratios, financial statements and reporting, because of regulatory requirements and asset/liability knowledge. Strange that LSE, king of undergraduate studies in anything remotely related to or geared towards Economics and Banking in Europe, and known for that worldwide, does not have the CT2 exemption.
LightningFist
post Mar 30 2012, 06:07 PM

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QUOTE(justastudent @ Mar 30 2012, 05:42 PM)
right... um... so if i'm not that into finance, will you suggest me go for statistics instead or finance is not a really big part in actuarial science so it's still ok?
thanks a lot ^.^
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Finance in Actuarial is relatively small. Introductory Corporate Finance, Derivatives, Investment. Basic concepts needed for valuation, risk management, and learning about markets and investment strategies. It doesn't have to go further than this.

I think I would get bored to death in a Statistics degree.

Hey do you mind refreshing my mind with a little math? You're good at it right? Problem is if you don't use it then after a while you get rusty.

A = B exp® (exponential)

Take natural logs of both sides.

r = lnA - lnB = ln(A/B)

It's not possible to get lnA = rlnB at all right? Damn these lecturers.
LightningFist
post Mar 30 2012, 07:13 PM

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QUOTE(fino_abama @ Mar 30 2012, 06:13 PM)
It can only be ln A = r + ln B. i think your lecturer left out the plus sign
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Seems so silly and trivial to ask a Year 10 question like this right? But this teacher wrote the frigging book I pulled that out of...
LightningFist
post Mar 30 2012, 10:40 PM

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QUOTE(RyukA @ Mar 30 2012, 10:25 PM)
A statistician knows how to joke alot better and in a more comprehendable way than an actuary, traditionally.
Well, I observe that from a sample of my lecturers. hahahaha.
it usually goes this way
Applied statistics < Specialised statistics< Mathematical statistics

Finance is basically an application of statistics. With some crap theories, contributed by economists as well. Hahaha.

Dont be too concerned bout dealing with exponents,
till today I still refer to notes to do integration by part and integration of exponents. lol
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Can't wait to relearn by parts >.<

These guys really suck at Math


Added on March 30, 2012, 10:42 pm
QUOTE(justastudent @ Mar 30 2012, 06:13 PM)
so it's still ok for me to take actuarial science then? =P

eh.... i haven't learn bout exponential yet lol
cant help much sorry >.<
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But if you're doing A Level Maths or Further you must definitely know much more than this... Year 10 stuff... unless you've forgotten everything like me haha

This post has been edited by LightningFist: Mar 30 2012, 10:42 PM
LightningFist
post Mar 30 2012, 11:12 PM

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QUOTE(fino_abama @ Mar 30 2012, 11:07 PM)
Must have been a typo
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Hmm well it's been printed more than a few times, and there are more than a few writers, along with claims from a certain instructor that mistakes are never made (although we get them too frequently). A very large and unusual typo... how does a mistake like that happen...
LightningFist
post Apr 1 2012, 04:09 PM

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QUOTE(MeowNYC @ Apr 1 2012, 06:02 PM)
I am the SPM leaver. A question I'd like to ask here after seeing some posts :
Q : After you complete the degree in AC, u are nt an actuary yet ? o.o
Isn't it u need to take a professional exam like SOA, etc to become an actuary ?

How about UTAR AC degree? I heard there's a SOA examination.
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It is possible to be an actuary after a degree, but not necessarily entirely because of the degree. If you finish all the relevant exams and any exemptions where applicable for an associate of the institute and meet all the other requirements then you're an actuary in the same sense as a person who has completed his MD is a doctor while someone who has completed his BEng/MEng is an engineer by training.

No degree will make you an actuary (i.e. if you don't do anything external beyond the degree). It's not just the academic exams, there are work experience and training and seminar requirements.

For the UK/Australia, many exams can be done through a degree. So that get's you part of the way towards becoming an actuary.
LightningFist
post Apr 22 2012, 09:43 AM

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QUOTE(saufisalleh @ Apr 8 2012, 09:30 AM)
Thanks  biggrin.gif
Which one course that relate to the actuarial science?
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For degrees, concentrations, and majors, there are many:

Actuarial Science or Actuarial Studies (also with/and Risk Management, Insurance, Maths, Statistics, Economics, Finance etc)
Actuarial Mathematics
Actuarial Management
Actuarial Statistics
Actuarial Finance
Insurance and Risk Management
Mathematics, Operational Research, Statistics and Economics
Financial and Insurance Mathematics
Mathematical Risk Management

Others that are less closely related you may be interested in:

Statistics
Business Mathematics and Statistics
Statistics with Finance
Quantitative Finance
Applied Mathematics
Financial Engineering
Data Mining
Statistical Computing
Applied Finance
Finance
Financial Mathematics
Mathematical Finance
Economics
Mathematics
Accounting
Commerce
Business
Science

LightningFist
post Jun 10 2012, 07:32 PM

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Quite right. To be an actuary the paper qualifications and experience components are very important, more than the "top school" factor that other fields (banking, finance, consulting, law) sometimes select for in addition to excellent results.

In fact, you'll notice many top schools don't even teach Actuarial Science! In Britain I can think of LSE and Warwick University, but they don't even have (for now) full exemptions! The major ones are City University (Cass Business School) and Kent. Although, if you did Mathematics at Cambridge University you might have as much of a shot for en entry level role as someone who did an Actuarial undergrad. So long as you show the willingness and potential to do exams. It's not about the degree - Accounting or Finance backgrounds are common too. In the US you can go to Wharton but it's not a straight Actuarial degree. Plus no major exemptions in the US anyway. NUS only has a joint Actuarial degree. Australia has quite a few.
LightningFist
post Oct 13 2012, 07:24 PM

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QUOTE(rere01 @ Oct 13 2012, 07:38 PM)
i don't really understand actuarial science.
if i am to take it, what subjects am i required to have in A-levels and what bachelor degree should i get?
i am kinda interested in it but i don't feel like leaving science, is it possible for me to take engineering for bachelor and actuarial science for masters? would it be much of a difference? i just feel like being more versatile.
btw i am form 5, taking science stream+ accounts
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It's an interdisciplinary field. You're required to study Mathematics, Statistics, Economics, and Finance. Even a bit of Accounting. It's like there's overlap... you don't do everything a Maths or Economics student does.

Traditional applications are insurance (general, life, health), pensions, and investment. But qualified actuaries and those who have studied actuarial science sometimes venture beyond these fields into enterprise risk management, banking, statistics, and really any area where these skills may be used (casinos, airlines, energy suppliers) or where risk and statistics are involved. At the very least, they can work in Finance, but may have to explain their degree.

It's not uncommon for those in the field to possess a Master's degree (could be a requirement in Australia - and such degrees are available in the UK) but it's not always necessary. At the same time, there is no requirement for any degree, Bachelor's or Master's, in Actuarial Science unless you are qualifying in Australia (it's complicated, because they require some graduate education even if you're not awarded a Master's degree).

It's not unusual for Engineers to move into Actuarial Science, given their Mathematical ability. Economics and Finance can be difficult, but they are no match for Mathematics.

If in America, Malaysia, and the UK, you need to pass external exams (for which exemptions via a degree exist), so it doesn't depend on what degree you choose. It's good that you're interested in Engineering, and there's always Mathematics. Some people with Statistics or Economics degrees qualify, others may have more exotic ones.

That's a lot to take in and you haven't started your A Levels yet. You need Maths. For Engineering you want Physics and Chemistry, and Further Maths helps in both. The only required subject is Maths but the Engineering combo will boost any application.
LightningFist
post Oct 13 2012, 09:54 PM

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QUOTE(rere01 @ Oct 13 2012, 11:11 PM)
i am really quite good and interested in maths, accounts and physics, but kinda weak and uninterested in chemistry and biology, however i always manage to get an A for biology and chemistry too, kinda concerned about what should i further my studies in, thought of engineering or actuarial science.
However, i don't think i know really that much about them and am open to any suggestions about what other paths can i take, i feel like engineering is the only thing everyone i know that is into physics takes, what suggestions do u have for me?
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Well, whatever you're studying at high school, it's gonna be different from the end of high school/6th Form/A Level. Whatever you study then is gonna be different from uni. Of course there'll be similarities, some of the foundational knowledge. But as a whole you won't know if you'll like it at uni.

Accounting can be really boring. If I asked you to open up a university level Maths, Statistics, Accounting, Economics, or Finance textbook, you might turn away in disgust. Very hard to tell.

You need to go far. Maths is very theoretical. Nevermind applications. You'll go through a lot of crap before you see Applied Mathematics. Engineering is less theoretical than Physics. You don't like Biology or Chemistry so health sciences, life sciences, or chemistry won't do.

If you really like systems, logic, then maybe Engineering or Computer Science type subjects will interest you. Do a bit of googling. Statistics can be quite boring too. In Maths you'll not have time to be bored as you'll be working your ass off.



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