FM Lesson 35: Price Estimation Using Durations

Hi there!

Today I have released a new lesson for my Financial Mathematics series on Youtube! This is lesson 35 of my FM series, and will most likely be the last lesson of FM for the foreseeable future.

In this lesson you'll learn all about estimating present values/prices using durations. 

Specifically, here's what you will learn in the lesson:

1. How to estimate the price of a set of cashflows using the first-order modified approximation
2. How to estimate the change in price and percent change in price for a set of cashflows given a change in interest rates
3. How to estimate the price of a set of cashflows using the first-order Macaulay approximation

These were topics I previously had not covered, but is tested on the Actuarial Exam FM. With this lesson, I have now covered all the major topics of that exam. You can find all 35 lessons in my FM playlist on Youtube!

Do note that there will be a corresponding examples video for this lesson releasing later this week, so keep your eyes out for that as well! 

I hope you enjoy this new FM video! This is the last topic in the 5th unit of FM for my video series, so you can expect the Unit 5 review video soon! I am working hard on that unit review video, as well as the final exam review video. Stay tuned!

- Josh

P.S. I will have worksheets available for this lesson video and its corresponding examples video in the future. I plan to release them at the same time as the unit review and final exam review worksheets, which are still in production. Thank you for your patience as I continue to work on those videos and their worksheets!