• We are pleased to announce that the winner of our Feedback Prize Draw for the Winter 2024-25 session and winning £150 of gift vouchers is Zhao Liang Tay. Congratulations to Zhao Liang. If you fancy winning £150 worth of gift vouchers (from a major UK store) for the Summer 2025 exam sitting for just a few minutes of your time throughout the session, please see our website at https://www.acted.co.uk/further-info.html?pat=feedback#feedback-prize for more information on how you can make sure your name is included in the draw at the end of the session.
  • Please be advised that the SP1, SP5 and SP7 X1 deadline is the 14th July and not the 17th June as first stated. Please accept out apologies for any confusion caused.

CMP Chapter 15 & 16

S

shinmo

Member
ST 2 Chapter 15
Page 11
The equity margin should be combined with increased risk of not achieving increased yield, the net result being the risk free rate of return.

Page 12
Besides valuing bond cashflows where both would use risk free rates, would financial economic and traditional approaches result in same answer at other times?

ST2 Chapter 16
Page 16
What is probability of absolute ruin? As opposed to the usual definition of ruin probability.
Why is it only possible to calculate ruin probability where there is no new business?
 
1. read "be combined" as "cancel out"

2. Yes they could, given the traditional approach is fairly subjective with regard to assumptions.

3. Someone else might be able to confirm I think it means ruin at any possible future time. If new business didn't cease then i suppose you'd have to project to infinity.
 
You must log in or register to reply here.
Back
Top