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MSc Risk and Stochastics

Course Description

About the MSc programme

This programme provides high-level training in probability theory and statistics for random processes with applications in the areas of insurance and finance and their interface. It includes a comprehensive and unified approach to all quantitative aspects of modern actuarial science. Students receive rigorous training in mathematics and scientific computation and are introduced to a range of schemes for risk transfer, sufficiently broad to equip them for highly specialised work in insurance, pensions, investment, and banking and for independent research in these areas.

The programme is mathematically advanced and suitable candidates will normally hold a first class honours BSc degree in actuarial science, statistics, mathematical economics or mathematics. This should include training in analysis and linear algebra, with rigorous proofs, and probability theory at the level of our third year undergraduate course Stochastic Processes.

Your application should be submitted as early as possible and must include:
A personal statement, no longer than 150 words, outlining your reasons for wanting to study Risk and Stochastics
Course descriptions and reading lists for advanced courses in mathematics and statistics in your degree (either held or pending)

Please note that the Department of Statistics requires references to be submitted with your application form from at least one person who is familiar with your academic achievements. Normally, this will be a tutor from your current or previous academic institution.

Programme details

Each MSc student has an academic adviser who is available for guidance and advice on academic or personal concerns. The compulsory courses lay the foundations in advanced stochastic models and methods and give a broad introduction to theories of risk exchange in insurance and finance. Students can choose options in statistics, mathematics and finance.

Compulsory courses

(* half unit)

Stochastic Processes* provides a broad broad introduction to stochastic processes with an emphasis on financial and actuarial applications.
Insurance Mathematics* provides an introduction to life and pensions insurance mathematics based on the theory of stochastic processes, notably counting processes and their associated counting martingales.
Computational Methods in Finance and Insurance* develops computational skills and introduces a range of numerical techniques of importance in actuarial and financial engineering.
Stochastics for Derivatives Modelling* examines valuation and hedging of derivative securities.
Recent Developments in Finance and Insurance* covers recent developments in the theory of stochastic processes and applications in finance and insurance and their interface.
Students will be expected to choose courses to the value of one and a half units from a range of options.

Please note that not every course is available each year and that some courses may only be available with the permission of the course convenor and/or may be subject to space.

Graduate destinations

The programme offers excellent prospects for employment and further study. Students can gain employment in the finance or insurance industries. They can also go on to do a higher degree. The Department has good relations with the financial services industry, particularly insurance and professional bodies.

Visit the MSc Risk and Stochastics page on the London School of Economics and Political Science website for more details!

(Student Profile)

Reine El Bitar

1847.jpg Studying at LSE has helped me to expand both my personal and intellectual horizons. LSE is a small international community that offers the facilities for everyone to find and share their interests. The MSc Risk and Stochastics is a good vehicle for people who come from quantitative backgrounds and want to work in the financial or insurance industries. After obtaining a BSc in Mathematics, I needed to know how the theories apply in reality. This MSc, with its broad agenda that covers most of the maths and statistics that are crucial for a professional who works in the markets to understand, was just what I needed. LSE has an extraordinary market reputation that makes any ambitious student want to join it. I applied to LSE because I knew it would provide me with a solid background and increase my chances in launching a high calibre professional career. I especially enjoy the public lectures, careers events and conferences where you get to meet the most interesting people from all over the world, listen to their speeches and learn from their experiences.

(Student Profile)

Nina Lange

1848.jpg I wanted to study in London, because it is one of the world's financial capitals. LSE has by far the best reputation and the Risk & Stochastics programme sounded attractive. I like that the MSc is a 'programme' – everything is connected and we get a wide knowledge about different aspects of finance and their connection to insurance. I also enjoy the theoretical approach to finance that the Statistics department gives.

In my programme I feel that the teachers genuinely respect, know and care about their students. I like being exposed to a lot of new knowledge from being taught by experts and from seminars with external speakers. I also enjoy talking and studying with class mates.

Being at LSE has helped me choose a career path: In making the decision, I benefited from talking to teachers and received guidance and support from them. In addition I have made academic contacts, which is useful if I decide to stay in academia after a PhD. When I graduate, I will first finish studies in my home country and then I will pursue a PhD. The career of my dream would probably be a combination of teaching and working in the industry - but I have a few more years to decide on that.


Entry Requirements

First class honours in actuarial science, statistics, mathematical economics or mathematics; English standard level.

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