Hi Guys I have been working through the revision booklet for Chapter 5 (Stochastic Models of Investment Returns) and there are a wide variety of questions which seem to cover more material than the course notes. Is there a expectation on the type of question expected from this chapter? e.g. Is is necessary to know each of the annuity functions? Annual / monthly / continuous / in advance / in arrears? Thanks Patrick
That particular topic is the last one in CT1, and based on the past year questions it's almost always lognormal (either with mean and standard deviation or the parameter values given) if continuous, binomial if discrete. I understand that in a couple of instances, this question within CT1 did appear as a part question following an annuity calculation. Although it's unlikely that you would be specifically tested on it, but they could (presumed knowledge).