• Discrete probability: basic concepts and elementary models, conditional expectation, martingales
• The binomial asset pricing model

After completing this class the student will have the ability to:

• describe and apply the basic concepts of discrete probability
• describe and apply the binomial asset pricing model

Since this is a course with an immanent examination character (PI), attendance is mandatory. Students can miss two units without excuse, absenteeism in further units must be excused / justified by email. This applies regardless of the learning mode (presence mode or distance teaching via MS TEAMS).

The class is mainly taught as a combination of lectures and exercises with homework assignments. Students present their solutions which will be discussed in the group. The course also serves as a preparation for some of the mathematics lectures of the Master in Quantitative Finance curriculum.

Lecture periods will take place on Microsoft Teams. More information will be provided at the start of the teaching period.

• one written final exam: 45%
• one written midterm exam: 45%
• group homework assignments: 10%

There will be no opportunity to retake the exams.

Detailed information will be provided in the first unit of the course.