# SOA Exam MFE/3F free course materials and paid for online video courses for MFE exam 2011

## MFE 3F: Financial Economics Segment of Society of Actuaries EXAM M/ 3F of CAS

The following free courses on FinanceTrainingCourse.com cover various topics outlined in Society of Actuaries Learning Outcomes for Exam MFE, the Financial Economics Segment of Exam M and the CAS 3F exam. They provide supplementary prep materials for some of the more difficult concepts covered in the course.

As part of your preparation for your final attempt, you have been looking for anything that can provide the extra edge for your MFE / 3F attempt. While the material below was not prepared keeping the SOA curriculum in mind it takes a hands on excel based approach in illustrating the many concepts covered in the SOA MFE /CAS  3F exams. Our hope is that this extra bit will clear the final muddle about those elusive Stochastic calculus, Continuous Time Finance, Option Greeks & Delta hedging concepts that you had been struggling with.

The links below covers interest rate models (CIR and BDT), Binomial Trees, Black Scholes Model, Pricing Derivative securities, differentiating between N(d1) and N(d2), exotic product and options, interpreting Greeks, Delta Hedging, investment and portfolio management concepts and other related topics.

Please note that the material below does not include treatment for :

• Vasicek bond price model
• Ito’s Lemma
• Derivation of the Black Scholes equation
• Theoretical background around the many theorems that build the foundation for Black Scholes Analysis

## SOA MFE / CAS 3F Exam Prep  – Interest Rate models

### SOA MFE/ CAS 3F: Cox-Ingersoll-Ross interest rate model

We discuss the simplest of interest rate models, the Cox Ingersoll Ross interest rate simulator and review the model as well as the steps required in its calibration.

Interest Rate Simulation & Forecasting: Using CIR (Cox Ingersoll Ross) Model: Introduction

Interest Rate Simulation & Forecasting: Using CIR (Cox Ingersoll Ross) Model: Estimating Parameters & Calibrating the CIR Model

Interest Rate Simulation & Forecasting: Using CIR (Cox Ingersoll Ross) Model: Simulating the term structure of interest rates

Cox-Ingersoll-Ross (CIR) interest rate model – Parameter calibration, Short rates simulation and modeling of longer term interest rates – An example

### SOA MFE/ CAS 3F: Black-Derman-Toy interest rate model

A slightly different application is used to illustrate the construction and calibration of the one factor no arbitrage Black, Derman and Toy (BDT) model

Interest Rate Simulation Models: Black, Derman and Toy (BDT): Building BDT in Excel: Introduction

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: Define Input Cells

Interest Rate Simulation Models: Building Black, Derman and Toy (BDT) in Excel: Define Output Cells

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: Define Calculation Cells: Construct short rate binomial tree

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: Define Calculation Cells: Construct State Price Lattices

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: Define Calculation Cells: Calculate Prices from Lattice

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: Define Calculation Cells: Calculate Yields & Yield volatility from Lattice

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: Define & Set Solver Function & Results

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: How to utilize the results of a BDT interest rate model: Derivation of Short Rates

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: How to utilize the results of a BDT interest rate model: Pricing Bonds

Interest Rate Simulation Models: Steps for building Black, Derman and Toy (BDT) model in Excel: How to utilize the results of a BDT interest rate model: Pricing Options

## SOA MFE / CAS 3F Exam Prep- Valuation of derivative securities

### SOA MFE/ CAS 3F: Derivative Products

The following courses provided a detailed introduction to Options and Derivatives/ Options pricing. This material includes discussions on the put call parity , Black-Scholes option pricing model, Greeks, Exotics, etc.

Options Crash Course for dummies

Options & Derivatives Products

Advance Options & Derivatives Crash course

Options Pricing reference

### SOA MFE/ CAS 3F: Calculate the value of European and American options using the binomial model.

This course focuses on an alternative method of implementing a two-dimensional binomial tree compared to the traditional method of building a binomial tree in excel presented in most option pricing textbooks. The alternate approach is based on the techniques documented by Professor Mark Broadie at Columbia Business School as part of his coursework in Security Pricing and Computational Finance courses at Columbia University and allows us to extend a simple 3 step tree to a 50 – 100 step option pricing tree in a few minutes.

The course starts with pricing European calls and put options, followed by pricing American options and closes by reviewing option pricing for Knock out and Knock in (Sudden Death). We also review the special case of a down and in option.

Options pricing – Using binomial trees to price options in a spreadsheet

Options Pricing – Pricing Call Options – Option pricing spreadsheet – Binomial trees

Options Pricing – Pricing American Options – Calls and Puts – Spreadsheet implementation – Binomial trees

Options Pricing – Pricing Put Options – Option pricing spreadsheet – Binomial trees

Options pricing–Exotics Options–Pricing a Capped Call–Excel implementation – Binomial trees

Options pricing – Pricing Knockout exotic options – Sudden Death Options – Down and out call options

Options Pricing – Binomial Trees – Pricing Sudden death Options – Down and in call options

Option Pricing – Black Scholes – Probabilities Explained: Understanding N(d1) vs N(d2)

### SOA MFE/ CAS 3F: Interpret option Greeks & Delta Hedging.

Delta Hedging  – Dynamic Hedging – Option Greeks Guide

The understanding option Greeks reference resource for dummies

Understanding Greeks – Introduction

Understanding Greeks – Analyzing Delta & Gamma

Understanding Greeks – The Guide to delta hedging using Monte Carlo Simulation

Delta Hedging – Cash PnL Simulation – Excel Spreadsheet walkthrough

Understanding Greeks – The Delta Hedging Simulation extended for Put Options

Understanding Greeks – Quick Reference Guide to Delta, Gamma, Vega, Theta & Rho

## Monte Carlo Simulation SOA MFE/ CAS 3F: Simulate lognormal stock prices.

Computational Finance: Monte-Carlo (MC) Simulation method– Building Equities, Commodities, Currencies and Interest Rate MC Simulators in Excel

Computational Finance: Building your first Monte Carlo (MC) simulator model for simulated equity prices in Excel

Extending MC simulation for currencies and commodities

Computational Finance: Monte Carlo (MC) Simulation method: Understanding drift, diffusion and volatility drag

Computational Finance: Linking Monte Carlo Simulation, Binomial Trees and Black Scholes Equation

### SOA MFE/ CAS 3F: Use variance reduction techniques to accelerate convergence

Monte Carlo Simulation: Convergence and Variance reduction techniques for option pricing models

Monte Carlo Simulation – Variance Reduction procedures: Antithetic Variable Technique & Quasi Random sequences

## Risk Management Technique MFE/ 3F: Control risk using Delta-hedging

Dynamic Delta Hedging for European Call Options

Dynamic Delta Hedging – Extending the Monte Carlo simulation model to Put contracts

## SOA MFE/ CAS 3F Exam Prep Related Paid Materials

Visit our Finance Course store to purchase pdf versions of these and other courses as well as video courses and detailed EXCEL examples as mentioned below:

## SOA MFE / CAS 3F: Solved EXCEL Examples and Solutions (Paid for courses)

1. SOA MFE / CAS 3F Related Excel & PDF section of the store
2. Delta Hedging  – Dynamic Hedging – Option Greeks Guide
3. Black Derman Toy Model Construction – EXCEL Example
4. How to utilize results of a Black Derman Toy Model – EXCEL Example
5. Derivative Pricing – Binomial Trees EXCEL Example
6. Calibration of CIR Model – EXCEL Example
7. Cox-Ingersoll-Ross (CIR) Interest Rate model – EXCEL example
8. Monte Carlo Simulation – Equity – Example
9. Monte Carlo Simulation – Commodity – Example
10. Monte Carlo Simulation – Currency – Example
11. Monte Carlo Simulation – Variance Reduction Procedures – EXCEL Examples
12. Valuing Options – Binomial Tree – Traditional Approach – EXCEL Example
13. Valuing Options – Black Scholes Example

## SOA MFE/ CAS 3F: Video Courses (Paid for courses with free samples)

1. Understanding N(d1) and N(d2)
2. Derivative Products
3. Derivatives Terminology Crash Course
4. How to construct a Black Derman Toy Model in EXCEL
5. How to utilize results of a Black Derman Toy Model

## SOA MFE/ CAS 3F: PDF courses (Paid for courses – easy to read pdf versions of online course materials)

Interest Rate Simulation Crash Course

## Understanding Delta Hedging & Greeks – Technical Interview Guide

Till November 30th, take \$60 off the cover price when you order your electronic copy. The package includes a 71 page study guide and 3 supplementary Excel Spreadsheets that focus on Monte Carlo Simulation of Dynamic Delta Hedging, Calculation of Cash PnL & Dissection of Option Price Sensitivities (Greeks).

Learn more about the title through the Delta Hedging & Greeks Book launch post.