[[Actuarial Notes Wiki|Wiki]] / [[Actuarial Certifications]] / [[Society of Actuaries (SOA)]] / **Exam FM-2 (SOA)**
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## Exam FM-2 Syllabus
The **Financial Mathematics (FM-2) Exam** is a 2.5 hour exam with 30 multiple choice questions about financial mathematics concepts and how they are applied in calculating present and
accumulated values for streams of cash flows.
### Learning Objectives
> [!example]- Time Value of Money: 5-15% {? Concepts}
> Test
> [!example]- Annuities/Cash Flows with Non-Contingent Payments: 20-30% {? Concepts}
> Test
> [!example]- Loans: 15-25% {? Concepts}
> Test
> [!example]- Bonds: 15-25% {? Concepts}
> Test
> [!example]- General Cash Flows, Portfolios, and Asset Liability Management: 20-30% {? Concepts}
> Test
### Concepts
#### 1. Time Value of Money
###### Present Value
![[Present Value#Definition]]
###### Future Value
![[Future Value]]
###### Accumulated Value
![[Accumulated Value]]
###### Interest Rate
![[Interest Rate]]
###### Discount Rate
![[Discount Rate]]
###### Effective Interest Rate
![[Effective Interest Rate#Definition]]
###### Nominal Interest Rate
![[Nominal Interest Rate]]
![[Force of Interest]]
![[Accumulation Function]]
![[Discount Function]]
![[Equation of Value]]
![[Net Present Value]]
#### 2. Annuities / Cash Flows with Non-Contingent Payments
<figure>
<img src="Media/Attachments/Annuities actuarial notation.png" width="500" alt="Annuities actuarial notation">
</figure>
![[Annuity Immediate]]
![[Annuity Due]]
![[Perpetuity]]
![[Level Annuity]]
![[Arithmetic Increasing Annuity]]
![[Geometric Increasing Annuity]]
![[Deferred Annuity]]
![[Continuous Annuity]]
#### 3. Loans
<figure>
<img src="Media/Attachments/Payday-loan-store.png" width="500" alt="Payday Loans">
</figure>
![[Principal]]
![[Amortization]]
![[Outstanding Balance]]
![[Balloon Payment]]
![[Amortization Schedule]]
#### 4. Bonds
<figure>
<img src="Media/Attachments/TWO HUNDRED DOLLAR WAR BOND.png" width="500" alt="War Bond">
</figure>
![[Bond Price]]
![[Coupon]]
![[Coupon Rate]]
![[Face Value]]
![[Yield Rate]]
![[Accrued Interest]]
![[Book Value]]
![[Premium]]
![[Discount]]
#### 5. General Cash Flows, Portfolios, and Asset–Liability Management
<figure>
<img src="Media/Attachments/Zero beta portfolio of CAPM.png" width="500" alt="CAPM">
</figure>
![[Yield Curve]]
![[Spot Rate]]
![[Forward Rate]]
![[Macaulay Duration]]
![[Modified Duration]]
![[Convexity]]
![[Immunization]]
![[Redington Immunization]]
![[Cash Flow Matching]]
![[Price Risk]]
![[Reinvestment Risk]]