Maths Knowledge Required for Commerce majoring in Finance (1 Viewer)

[UWS-Uni-Student]

Nah.

I don't see how that's a valid assumption.

If you did the highest level of maths possible in Highschool most maths will seem easier for you then it would for someone who did 2U or general maths.

How would what compare to 2u or gen? IB and ops?

Anything in Finance, as the OP is asking about how hard the maths, and maths does include General maths all the way to 4U maths.

It might be ideal to suggest how it compares to the requirements for quantative methods for CPA and finance units for CPA.

You still have to be smart to do well in IB, so if you struggled with any less than 3u forget about banking. Couldn't tell you about ops but it's a lot easier to get in there than any front or middle office role.

Will comment later

 

[Rorix]

If you did the highest level of maths possible in Highschool most maths will seem easier for you then it would for someone who did 2U or general maths.

Dude, while this make sense in theory, i can assure you that IB requires plus minus divide and times (and even that can be done in excel). This is not derivatives trading stuff here.

But, like ND said, if one is doing general maths etc., I find it hard to believe that they would have the financial intelligence necessary to make any discretionary decisions based on presented data.

 

[UWS-Uni-Student]

But, like ND said, if one is doing general maths etc., I find it hard to believe that they would have the financial intelligence necessary to make any discretionary decisions based on presented data.

I wouldn't know I didn't do general maths, but there are people who have that get into university and do commerce degrees, so I thought to maximise this threads use to the widest audience it would be advisable to factor that in.

 

[Archimedes]

dyun, the maths required for finance at uni is simple. A few formulas for some subjects, black scholes option pricing and other forumulas like that, but they aren't too difficult.

 

[Epic_Postings]

dyun, the maths required for finance at uni is simple. A few formulas for some subjects, black scholes option pricing and other forumulas like that, but they aren't too difficult.

after almost 2 months at uni i'd have to say that is true. Right now the subject with the most difficult maths (for me) is Quantitative research methods.

 

[watatank]

What do all the Maths and Finance/Eco (double major people) graduates go into that straight commerce people can't (or would have trouble with)?

 

[Anonymou5]

Black Scholes sounds like the name of a PDE!

 

[UWS-Uni-Student]

Okay so most of finance is easy maths, apart from Derivatives (is there others) Cause I think it could be a good idea to establish a list so that similar questions which may occur sometime in the future could be referred to a list of finance topics and subjects and the level of maths one would need to study them.

It could even be adopted to cover different universities.

Example would be something like this:
Financial Institutions and Markets: [Difficulty in terms of math]
Investment Management:
Derivatives:
Financial Statement Analysis:
Financial Transactions Law:
Portfolio Management:
Corporate Finance

etc

 

[Newbie]

basic first year finance is easy but it depends on how far you wana take it
im sure honours level gets pretty technical

 

[Archimedes]

after almost 2 months at uni i'd have to say that is true. Right now the subject with the most difficult maths (for me) is Quantitative research methods.

Well there's a real problem, you're actually doing that subject. What a waste of time! I did it as an elective and regretted it. It's best avoided like the plague, if thats possible. Unless it's a core unit for your degree, in which case I pity you

 

[UWS-Uni-Student]

Well there's a real problem, you're actually doing that subject. What a waste of time! I did it as an elective and regretted it. It's best avoided like the plague, if thats possible. Unless it's a core unit for your degree, in which case I pity you

If you want to be able to do CA or CPA its generally required (although I don't know which university dyun is referring to I assume it is the same as Statistics for Business

 

[Archimedes]

Nah, it's not required for either of those

 

[keithmoon]

Pretty much zero mathematical ability required. If you're intelligent enough to get into commerce you shouldn't have any trouble with finance subjects.

In my opinion finance is far more about concepts than maths - I've found formulas flow easily and logically when you hve a good understanding of the underlying finance concept/theory (rather than just memorising the formula).

My best advice is don't worry about the maths, but do go to your classes....(advice I wish I had taken!)

:wave:

You are an idiot.
Finance requires maths, and plenty of it.

Bye.

 

[UWS-Uni-Student]

If any mods thinks that this concept of creating a list of topics and the difficulty of maths would be a good idea for pegging (or stickying) for future use of members, as I suspect that questions along these lines will occur in future periods.

I think that for future reference for all people who are interested in asking this question that we set up some sort of list of topics/concepts and the maths required.

Ill start this by listing some concepts (this list is incomplete, and if anyone wants to add to it or fill the information out, I believe that could be beneficial for future question askers)

Insurance & risk management:
Risk management decisions:
Risk management process:
risk management techniques:
property and liability exposures:
risk management for home owners:
interest rate risk management:
liquidity and liability management:
capital management:
operational risk management:
management of the securities portfolio:
international financial transactions:
exchange rate determination:
risk exposures in a volatile international financial environment:
foreign exchange market:
national economic performance:
the international monetary system:
International lending, borrowing and foreign direct investment:
risk versus return trade-off:
Analysis and valuation of securities:
Issues in efficient markets:
Financial statements analysis:
Fixed Income Securities:
Derivative Products:
International Securities Markets:
Mutual Funds:
Portfolio Management:
management of credit risk exposures:
Loan decisions and loan pricing decisions:
and modern credit risk
measurement and management techniques:
traditional credit risk models:
Superannuation:
banker and customer relationship:
bills of exchange:
bankruptcy:

 

[Rorix]

I'm not really sure how you came to generate that list, but I can list some topics which have no-very limited maths

Financial Valuation including company analysis, proforma statements, cash flows etc.
Theory - market microstructure, market efficiency etc. [excluding asset pricing models]
Financial Planning
Capital Structure
Dividend Policy
Anything where people quote a "rule of 72"
Derivatives theory [excluding advanced derivative pricing]
Utility theory
CAPM/APT/Single Index Model/Markowitz [excluding construction with large number of assets]

not exhaustive

 

[§eraphim]

I think we have to distinguish between developing and using mathematical models. There are a lot of sophisticated models out there that people just use without really understanding the mathematics behind it. eg Black-Scholes.

Also, take for instance, financial econometrics. It can be quite mathematical, but it's most often presented as stripped down stats built around mastering certain econometric software.

As such, it is difficult to pinpoint areas within finance that are easy on the maths as there is a whole spectrum.

IMO, the main area requires very little understanding of the maths, just know how to use stats software would be returns analysis, eg factor models, as I haven't seen an intuitive way to model returns without statistical models. The other areas have been approached from a "physics" point of view with the aim of trying to describe the underlying dynamics (with the help of a few assumptions of course)

eg corporate finance -> firm value models, eg KMV

 

[§eraphim]

You are an idiot.
Finance requires maths, and plenty of it.

Bye.

I agree. An equation says many things when you just look at it. It's usually a lot easier to describe than to derive.

 

[UWS-Uni-Student]

I'm not really sure how you came to generate that list, but I can list some topics which have no-very limited maths

I came up with as many concepts/issues/topics in finance, but as I have only started my finance units, I am unable to state what each topic requires, hence the "Topic:" I am hoping that those who have taken the topics can list next to each topic what each would require.

For example:

Topic X: 2U Maths

 

[Raginsheep]

Theoretically though, shouldn't the "business stats/math" courses that all students do at the start of their degree ensure that can deal with all the maths necessary for finance subjects unless specifically stated?

 

[UWS-Uni-Student]

Theoretically though, shouldn't the "business stats/math" courses that all students do at the start of their degree ensure that can deal with all the maths necessary for finance subjects unless specifically stated?

Another interesting point of to consider as someone who may not have done too well in HSC maths may have excelled in Statistics