Università degli Studi di Napoli "Parthenope"

Teaching schedule

Academic year: 
Belonging course: 
Course of Bachelor's Degree Programme on BUSINESS ADMINISTRATION
Disciplinary sector: 
Year of study: 
Dott.ssa CORSARO Stefania
First Semester
Hours of front activity: 



Course description

The aim of the course is to provide students with the basics of financial mathematics for the evaluation of financial contracts.
Knowledge and understanding: students should know the techniques and mathematical tools used for the evaluation of financial contracts.
Applying knowledge and understanding: students should be able to apply the acquired knowledge to evaluate contracts.
Making judgements: students should be able to use the acquired knowledge autonomously, by also applying them to other financial problems.
Communication skills: students should clearly describe the methodologies adopted for solving the exercises in the written exam, and answer in a clear and reasoned way to the questions of the oral exam.
Learning skills: students should be able to show a good learning ability, by widening, for example, their knowledge with use of relevant bibliographic references.


Contents of calculus.


The course introduces basic concepts of financial contract evaluation. The course content can be approximatively split into the following three blocks:
I block (20 hours):
The basic theory of interest: principal and interest. Present value. Present and future values of streams. Simple interest. Compound interest. Exponential law. Fixed-income securities. Rating. Value formulas. Yield.
Basic sources of risk. Interest rate risk. Credit risk. Inflation risk. Foreign exchange risk.
II block (28 hours):
Annuities. Loan amortization.
Internal rate of return.
No-arbitrage pricing. Coupon and zero-coupon bonds. Spot and forward rates. The term structure of interest rates. The yield curve. Par yield. Bootstrapping. Duration. Convexity.

Teaching Methods

The course is organized in classroom lectures and laboratory; laboratory sessions discuss the use of the spreadsheet for financial applications.


E. Castagnoli, M. Cigola, L. Peccati. Financial calculus with applications. Egea, 2013.
Samuel A. Broverman, Mathematics of Investment and Credit, 7th Edition, ACTEX Learning, a division of SRBooks Inc.

Learning assessment

The final exam consists of written part and an oral part. If the written part mark is sufficient, the student will hold the colloqium. Solving correctly the exercise on the arguments discussed in the I block is mandatory to be admitted to the colloquium. The mark depends on both the marks of the written part and the oral part.

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