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Actuarial Science Major Forum

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1 Actuarial Science Major Forum
-Change the title (LY) 6 PM, Thursday, August 24, 2017 110 Business Last edited

2 Discussion Topics Introductions Career Opportunities
II. Career Opportunities III. Penn State Courses IV. Actuarial Exams & VEE (& Transition Rules) V. Actuarial Science Club VI. Internships VII. Questions

3 Penn State Actuarial Program
Stats # 1 Job in US (per WJ) # 1 School for Recruiters (per BusinessWeek) Largest Actuarial Program in US About 150 exam passers per year About ½ from Smeal & ½ from Eberly (Math & Stat) Center of Actuarial Excellence – only 15 in US But It’s A Very Difficult Degree If not taking Actuarial Exams, it is best to choose another major Students with A’s and high B’s in Calculus and Probability: pass exams, get jobs Take STAT 414 & SOA Probability Exam (P) - 3rd Semester Take RM 410 & SOA Financial Math Exam (FM) - 4th Semester Take RM 415 & SOA Financial Economics Exam (MFE) - 5th Semester Internship + 3 Exams to get a job Intro Career Courses Exams Club Internships

4 Faculty Ron Gebhardtsbauer, FSA Zhongyi Yuan, PhD & ASA
Worked in Insurance, Pensions, Head of Mercer in NYC Spokesperson for US profession from 1996 to 2008, Actuary in Congress Teaches RM 412 (Pricing Life Insurance) & RM 297 (Probability) in Fall Teaches RM 410 (Financial Math) RM 415 (Pricing Derivatives) in Spring Zhongyi Yuan, PhD & ASA Teaches RM 410 (Financial Math) in Fall Teaches RM 420 (C Exam = P&C and Health) in Spring Nan Zhu, PhD & FSA Teaches RM 415 (Pricing Derivatives) in Fall Teaches RM 411 (Pricing Life Insurance) in Spring Lisa Weaver, LLD Retirement Consultant, Teaches RM 401 (Pensions) each Spring Lisa Posey, PhD & Dave Cather, PhD Teach Insurance and Risk Management [idea: I think we can add a slide about our officers info because I think we should introduce ourselves here, what do you think?]-LY Intro Career Courses Exams Club Internships

5 The Good We Do For the World
Mutual Benefit Societies helped Widows & Orphans Captains could build new ships & continue commerce Banks can make loans for tall buildings after 9/11 Actuaries project future & create products so that you needn’t worry about the high cost of: Needing an expensive medical operation Your kid’s financial needs if you or your spouse die early Becoming disabled Needing a new car after someone crashes into you Your home burning down, or being flooded by a hurricane Outliving your assets in retirement Your company going under if sued, etc. Capitalized Second and third bullet points Intro Career Courses Exams Club Internships

6 Club Officers Officer Position Internship John Miller President
Aon Hewitt, Philadelphia Shelley Shen Vice President NY Life, NYC Mitch Yerk Treasurer Global Indemnity, PA Kylie Krout Secretary Aon Hewitt, NYC Ethan Frederick & Ivan Yen Corporate Liaison Cigna, CT & Liberty Mutual, Boston Paul Birch Corporate Outreach Officer Liberty Mutual, Boston Yalan Yu Student Relations Liaison BC/BS, NY Noah Blake Social Chair Northwestern Mutual, Milwaukee Grace, Katie, Harry F, S, J Liaisons Aetna, Transamerica, AIG (PA, PA, GA) Christina Lei Webmaster Voya, West Chester, PA Di Fan Zheng Database Manager **Please feel free to officers after talking to your mentor. **You can get a mentor by using Google doc of Mentors or ing Yalan Yu or Shelley Shen. Intro Career Courses Exams Club Internships

7 Where Do Actuaries Work?
Insurance Practice Area Insurance 18-24 month rotational programs Competitive study programs Clear reporting structure (one boss), Reasonable hours Consulting, Investment, & Accounting Firms May have longer hours – especially during busy season Dynamic work environment Government & Academia Life/Annuity Health Retirement Property/Casualty Reinsurance Finance/Investment Intro Career Courses Exams Club Internships

8 Three ways to get into RM 410 in 4th Semester:
Get Started Early! Three ways to get into RM 410 in 4th Semester: 1. Take a calculus course in summer 2. Take MATH 231 and STAT 414 concurrently (MATH 230 for Eberly students) 3. Take MATH 141 in first semester (see footnote on slide 9) You must be in Major to register for RM 410 Smeal students must have 44 credits are PSU & FIN 301 to enter major Take RM 297 with STAT 414 – very helpful in passing 414 and the P Exam Intro Career Courses Exams Club Internships

9 RM Major – Actuarial Option (with Stat Minor)
Yr Fall Spring 1st MATH 140 or MATH 141+* (Calc I / II) ECON 102+* (Micro) – VEE STAT 200+ ENGL 015/030+ First Year Seminar MATH 141 or MATH 231+* (Calc II / III – Pre-req for STAT 414) ECON 104+* (Macro) – VEE ACCTG 211+* (Accounting–FIN 301 Pre-req) – VEE MGMT 301+ CAS 100 2nd MATH 231 and STAT 414* (Calc III & Prob Theory) RM 297 Excel; P Exam in Jan FIN 301+* (Corp Finance) – VEE MKTG 301+ RM 410* (Financial Math) Excel; FM Exam in June MATH 220 (Matrices) helps in 412/415/MLC MIS 204 ENGL 202D 3rd RM 415 (Derivatives Markets) VBA; MFE in late November STAT 415# (Math Stat) helps C/S/MS RM 320W (Insurance and Writing) BA 342 RM 411* (Life Contingencies) VBA STAT 483# (better SAS class) STAT 416# (Stochastic Processes) helps CAS Exam S BA 341 4th RM 412* (Life Contingencies); MLC Exam in late October STAT 462# (Regression Analysis) R RM 430 (Life & Health Insurance) BA 411 RM 420* (P&C/Health) Stat allows as substitute or RM 401*(Pensions) STAT 463# (Applied Time Series) R Take C Exam in June or CAS S Exam in Oct Must take CAS and other GA’s Talk about the first two years during forum, but tell people to reference the website for the rest of the sample schedule Deleted second bullet about difficulty/dropping the major If 5 on AP exam, place out of MATH 140 (to take 231 & 414 sooner). If you got a 4, see Math Dept Advising website on whether to place out Students with 44 PSU credits & FIN 301 can apply to ActSci Option & if admitted may schedule RM 410 (if have STAT 414). Take ACCTG 211 and SCM 200 in the 2nd semester so you can take FIN 301 in 3rd semester. P&C and Health insurers tell us that STAT 483 and other Data analytics courses help you get a job * C or better required. If C’s, consider other options or majors # for STAT minor; 462/463 needed for VEE & S for Entrance to Major Intro Career Courses Exams Club Internships

10 Smeal’s Business Core SCM 200*: Statistics for Business Or STAT 200
MIS 204*: Business Information Systems FIN 301*: Finance ACCTG 211*: Accounting MKTG 301*: Marketing MGMT 301*: Management BA 411: Analyzing Business & Industry B LAW 341: Business Law BA 342: Business Ethics Switched slide order Included Instead of majoring in Finance & Eberly’s Act Sci option take Smeal’s Act Sci Option with RM 415, sign up for Penn State’s Asset Mgmt Club, Investment Assoc, Finance Society, or Econ Assoc, read FIN 414 handouts at sites.google.com/site/lougattis/financial-modeling-files Act Sci students can skip Supply Chain 301 *C or higher required Intro Career Courses Exams Club Internships

11 Smeal Major Required Courses
RM 320W* (Fall Only) Risk Management and Insurance * C or higher required RM 430* (Fall Only) Life and Health Insurance For upperclassmen= * C or higher required RM 301 gone Intro Career Courses Exams Club Internships

12 Math Major - Actuarial Option (with Stat Minor)
Yr Fall Spring 1st MATH 140 or MATH 141* (Calc II) ECON 102* (Micro) – VEE STAT 200 First Year Seminar MATH 141 or MATH 230* (Calc III – Pre-req for STAT 414) ECON 104* (Macro) – VEE ACCTG 211* (Accounting–FIN 301 Pre-req) – VEE CAS 100 (Effective Speech) 2nd STAT 414* (Prob Theory) MATH 311W* (Discrete Math) RM 297 Excel; P Exam in Jan FIN 301* (Corp Finance) –VEE CMPSC 101 or 121 or 201 (Computer Programming) RM 410* (Financial Math) Excel; FM Exam in June MATH 312* (Real Analysis) RM 302 (Risk and Insurance) MATH 220 (Matrices) helps in 412/415/MLC 3rd MATH 250 or MATH 251 (Differential Equations) RM 415 (Derivatives Markets) VBA; MFE in late November MATH 484 (Linear Programming) STAT 415# (Math Stat) helps C/S/MS RM 411* (Life Contingencies) VBA STAT 483# (better SAS class) ENGL 202C MATH 451 or MATH 486 4th RM 412* (Life Contingencies) MLC Exam in late October STAT 462# (Regression Analysis) R IE 425 (Operations Research) RM 420* (P&C/Health) Stat allows as substitute or RM401*(Pensions) STAT 463# (Applied Time Series) R Take C Exam in June or CAS S Exam in Oct STAT 416# (Stochastic Processes) helps CAS Exam S Talk about the first two years during forum, but tell people to reference the website for the rest of the sample schedule Deleted second bullet about difficulty/dropping the major If 5 on AP exam, place out of MATH 140 (to take 231 & 414 sooner). If you got a 4, see Math Dept Advising website on whether to place out Students with 44 PSU credits & FIN 301 can apply to ActSci Option & if admitted may schedule RM 410 (if have STAT 414). Take ACCTG 211 and SCM 200 in the 2nd semester so you can take FIN 301 in 3rd semester. P&C and Health insurers tell us that STAT 483 and other Data analytics courses help you get a job * C or better required. If C’s, consider other options or majors # for STAT minor; 462/463 needed for VEE & S Intro Career Courses Exams Club Internships

13 Stat Major - Actuarial Option
Yr Fall Spring 1st MATH 140 or MATH 141* (Calc II) ECON 102* (Micro) – VEE STAT 200 First Year Seminar MATH 141 or MATH 230* (Calc III – Pre Req for STAT 414) ECON 104* (Macro) – VEE ACCTG 211* (Accounting–FIN 301 Pre-Req) – VEE CAS 100 2nd STAT 414* (Prob Theory) RM Excel; P Exam in Jan FIN 301* (Corp Finance) –VEE CMPSC 101 or 121 RM 410* (Financial Math) Excel; FM Exam in June MATH 220 (Matrices) helps in 412/415/MLC STAT 461 ENGL 202C RM 302 3rd RM 415 (Derivatives Markets) VBA; MFE in late November STAT 415 (Math Stat) helps C/S/MS STAT 464/466 RM 411* (Life Contingencies) VBA STAT 483 (better SAS class) STAT 416 (Stochastic Processes) helps CAS Exam S 4th RM 412* (Life Contingencies) MLC Exam in late October STAT 462# (Regression Analysis) R STAT 440/400+ RM 420* (P&C/Health) Stat allows as substitute or RM401*(Pensions) STAT 463# (Applied Time Series) R Take C Exam in June or CAS S Exam in Oct STAT 470W Talk about the first two years during forum, but tell people to reference the website for the rest of the sample schedule Deleted second bullet about difficulty/dropping the major If 5 on AP exam, place out of MATH 140 (to take 231 & 414 sooner). If you got a 4, see Math Dept Advising website on whether to place out Students with 44 PSU credits & FIN 301 can apply to ActSci Option & if admitted may schedule RM 410 (if have STAT 414). Take ACCTG 211 and SCM 200 in the 2nd semester so you can take FIN 301 in 3rd semester. P&C and Health insurers tell us that STAT 483 and other Data analytics courses help you get a job * C or better required. If C’s, consider other options or majors # for STAT minor; 462/463 needed for VEE & S Intro Career Courses Exams Club Internships

14 Eberly Majors - Actuarial Option
Business courses required: RM 302: Risk & Insurance (Fall is a good time to take it) Smeal students have to take RM 415/320/430 instead RM 410*/411*/412*: Actuarial Courses FIN 301: Corp Finance & Financial Markets - VEE ACCTG 211: Accounting – VEE (Math Majors need to get into FIN 301) Business courses not required: Business Core B LAW 341 & BA 342: Business Law & Ethics MIS 204: Intro to Business Information Systems Eberly students can get Business Certificate by taking a few courses * C or Higher required Intro Career Courses Exams Club Internships

15 Courses in Predictive Analytics (Data Science)
P&C and Health Insurers say they’ll hire more students with these courses Regression with HW in R: STAT 462 (taken for VEE) Time Series with HW in R: STAT 463 (taken for VEE) in SRM exam GLM: STAT 511 and someday in STAT 462 (taken for VEE) Machine Learning (Decision Trees, Clusters) CMPSC 448/DS310/STAT 557/464 Neural Networks & Classification: Principal Components Analysis STAT 505 (Multivariate Stat) prereq MATH441 DS310 prereq DS 220 & IST 210 SAS: STAT 483 much preferred (has some SQL) Monte Carlo: STAT 440 and 416, RM 411/412/415 (taken for MLC/MFE) Data Mining/Visualization: STAT CMPSC448 pre-req = CMPSC 122 Python Bayesian Comp Tech/MCMC/Bootstrapping: STAT 440 (Computational Stat) pre-req = MATH 220 Survey sampling: STAT 466 Survival Tables/Cox/Proportional Hazards: STAT 525 Design and Validation of Experiments/Outcomes: STAT 461 (Anal of Variance) See STAT Data Science majors take CMPSC 121, IST 210, STAT 380, and DS 220 in 1st 3 semesters Intro Career Courses Exams Club Internships

16 Other Good Courses to Take
MATH 220: Matrices – great for Markov Chains & MLC MATH 251:Differential Equations with PDEs MATH 412: Partial Differential Equations MATH 451 or 455: Numerical Computations/Analysis MATH 486: Game Theory FIN 305 (2 piece): Financial Mgmt of Business Enterprise FIN 408 (2 piece): Financial Markets and Institutions ECON 302/304: Intermediate Micro/Macro Economics ECON 351: Money and Banking HPA 057: Consumer Choices In Health Care for gym Gen Ed FIN 414 slides: Penn State Asset Management Club Penn State Investment Association Penn State Finance Society Penn State Econ Association Intro Career Courses Exams Club Internships

17 Courses with Programming
RM 297/410/411/412: Excel & VBA STAT 462/463: some Minitab, R, or SAS may be used STAT 483: SAS & SQL - great for Health and P&C jobs STAT 484/485: R RM 497 with Liang Peng R for financial topics Monte Carlo, hypothesis testing, linear regression, VaR, optimal portfolio strategy CMPSC 121/122 Intro to Computer Programming (Python?) CMPSC 200: MATLAB CMPSC 203: Excel with some Access MATH 451: MATLAB used lynda.psu.edu can also help with VBA Intro Career Courses Exams Club Internships

18 Success in Classroom and Business World
Profs and Bosses want students who understand why Word problems; essay answers Memorization helps but understanding is most important Preparation before class or meeting with boss Read & do synopsis of material before class/meeting Work with others Homework teams (plus good friends help after graduation) Confidence Class Participation; Teaching HW problems; Be TA’s Officers organize projects (not just put on resume) Good at self-study, internship, pass FSA exams Projects (e.g., selling insurance to parents, your retirement projection) Intro Career Courses Exams Club Internships

19 Actuarial Exams Given in Harrisburg, Philly, Pittsburgh
Or near your home over summer/winter breaks MLC Exam given at Penn State Society of Actuaries (SOA) Life/Pension/Health/ERM/Finance Casualty Actuarial Society (CAS) Property/Casualty P, FM, MFE, C exams satisfy CAS Intro Career Courses Exams Club Internships

20 Why Should I Take These Exams?
2 exams before Junior year Career Fair for internship 3 exams + internship for FT job Take exam during break after applicable course Tough passing FM exam when in RM 411 We cover all 5 SOA preliminary exams here Some students pass all before graduation Almost Associates in the SoA We pay you $100 if you pass exam ($200 for MLC and C) Take formal pass slip with score to 355 Business Request right away; Right before graduation is too late The Club pays another $200 to students who pass 4 exams! Intro Career Courses Exams Club Internships

21 SOA/CAS Exams Intro Career Courses Exams Club Internships reference
Best Manual Use during course too Take it when? Comments 1/P - Probability Theory STAT 414 & RM 497C ACTEX, SOA Q, ADAPT, Actuary Exam Tutor Sophomores: Jan 2/FM - Financial Mathematics (with Swaps) RM 410 ASM or ADAPT Sophomores: June Juniors: Dec Intro to Derivatives moved to MFE Summer 17 3F/MFE – Financial Econ 2018:Investment &FinMkts RM 415 Late November or July 415 done by late Nov StochasticCalc→FSAexam MLC - Life Contingencies 2018: Long-Term Act Math RM 411/412 Infinite Actuary Late October Early May Only RM 411 needed for CAS S exam 4/C – P&C and Health Ins 2018: Short-Term Act Math RM 412/420 STAT 415/416 TIA & Mahler ADAPT Q - pick your level SOA 308 Q great June Stan says easy after Zhongyi’s RM 420 former Applied Stat VEE Statistics for Risk Modeling STAT 462/463 GLM, etc. ? STAT 462/463 waive Exam thru 7/1/2018 S Exam (CAS) STAT 416, 462, 463 & RM 411 October 30, 2015 LC, Statistics, & Probability Models Predictive Analytics Proctored Project, after graduate? Maybe take first module over summer, if internship pays for it Tutorials at SOA policy on calculators: Some prefer TI 30X II. BA II Plus preferred for FM exam for its financial keys Intro Career Courses Exams Club Internships

22 Validation by Education Experience: VEE
Required by SOA, CAS, and Employers VEE’s ECON 102/104, ACCTG 211, FIN 301 required to graduate Take ACCTG 211 in Spring, per Head of Acctg Steve Huddart Also take VEE STAT 415 Must receive a grade of B- or better Or 4 or 5 on AP tests Can’t apply for VEE until pass P & FM Other Campuses can use University Park VEE codes per SOA Can also get credit by exam through ACTEX for Finance & Applied Stat VEE’s CLEP for Econ VEE Intro Career Courses Exams Club Internships

23 Applied Statistical Methods: VEE  Exam 2018
Accepted Courses: take one from each Applied Regression (must include Generalized Linear Models in 2018) STAT 462, 501, or 421; or ECON 306 (and maybe STAT 460) ECON prerequisite can be satisfied by Stat 414 Applied Time Series STAT 463 (STAT 510 or ECON 483 if available) You can mix and match. ECON 485 may satisfy both – check SOA’s VEE website Get STAT Minor - if also take: STAT 415 (Mathematical Statistics) VEE in 2018 already required in Eberly STAT 416 (Stochastic Processes) covers material in CAS Exam S STAT 480 (Intro to SAS - 1 credit) STAT 483 is better Some get ECON Minor Take ECON 302/304 & 6 credits of 400 level ECON such as 445 (Health Policy), 412 (Labor), 444 (Corp), & 457 (Banking) Irrelevent for most; describe briefly Intro Career Courses Exams Club Internships

24 ASA Changes Current Transition Rules New (Starting 7/1/2018) Intro
5 Exams P FM MFE MLC C 3 VEE’s Economics Corporate Finance Applied Stat Modules & APC New (Starting 7/1/2018) 7 Exams IFM LTAM STAM SRM PA 3 VEE’S Accounting and Finance Mathematical Statistics Transition Rules Attain ASA by 7/1/2018 + FSA by 7/1/2022 = exempt from changes Earn Applied Statistics VEE by 7/1/2018 = counts as SRM exam Earn Corporate Finance VEE by 7/1/2019 = counts as new Accounting & Finance VEE Intro Career Courses Exams Club Internships

25 Changes Starting 7/1/2018 Mathematical Statistics (STAT 415)
New required VEE course. Drops Mathematical Stat from C exam Applied Statistics (STAT 462 and STAT 463) Elevated to Statistics for Risk Modeling (SRM) Exam. Take STAT 462/3 before 7/1/2018, as it will waive exam! Must include Generalized Linear Models (GLM) – in STAT 421 instead of STAT 462 And Principal Components Analysis, Decision Trees, and Cluster Analysis in STAT XXX Predictive Analytics (PA) New Proctored Exam/Project (using R); SOA thinks students will wait until after graduation MFE becomes IFM (Investment & Financial Markets) ½ of MFE exam plus higher level Finance (Portfolio Variance, Efficient Frontiers, CAPM, Efficient Markets, Behavioral Finance, Investment Risk, Semi-Variance, VaR, TVaR, Decision Trees, Capital Structures (Miller-Modigliani, Asymmetric information) MLC (RM 411 and 412) becomes LTAM (Long-Term Actuarial Math) Estimating qx moves from C to MLC. Add Retiree Medical, LTC, LTD, & other LT products. Drop UL Exam C (RM 412 and 420) becomes STAM (Short-Term AM) Reserving and Ratemaking (pricing) being added to Exam C. Loss Development Factors and Triangles ASA by 7/1/18, FSA by 7/1/2022: exempt from new rules (e.g.,PA) Applied Stat & Exams by 7/1/18 transfer to comparable exams FIN 301 qualifies for Finance VEE thru 7/1/ Thereafter, need ACCTG 211 Intro Career Courses Exams Club Internships

26 Best Practices to Learn & Pass Exams
reference Read the book Don’t just read the words.  Read them until you understand them. Take notes on what you read Create a synopsis to refer to later Reproduce the calculations in the examples Ensure they are right. author with corrections Don’t trust what you read, unless and until you agree with it Take the class on the subject Be engaged in class Use recommended study manual on each exam Do lots of sample exam questions (with required calculators) Without looking at the answers first Work on a HW team. Talk to your teammates about the class Talk to your actuarial mentor about the material  We assign mentors to all rising Juniors.  Do you have a mentor? Meet with prof on lectures points and HW you don’t understand Intro Career Courses Exams Club Internships

27 Actuarial Science Career Fair
Monday 9/11/17 from 5 to 8 PM in Atrium Over 35 companies Great place to find Internships 1st yr students can get internships if have exam or very good in Math To attend: Must do Mock Interview & meet with Mentor for course/exam advice GPA>3.20, or A’s in Calculus, or Exam Passed Pay Club Dues Some firms (like Met Life and AXA) don’t attend Career Fairs, so apply on their websites Ivan Yen and Ethan Frederick Intro Career Courses Exams Club Internships

28 Club Opportunities Résumé & Mock Interview Workshop
Monday 8/28: 6 – 8 PM in 110 Business Bldg Submit resume asap via Club Resume Dropbox webpage Must use instructions on Club’s Resume webpage RM 410 students must do interview ASAP before Career Fair Mentors for Juniors (& interested Frosh/Soph) If interested, Yalan Yu Special Meeting for Commonwealth/Transfer Students Wednesday 8/30: 6 – 7:30 PM in 006 Business Special Meeting for International Students Wednesday 9/6: 6 – 7:30 PM in 006 Business Ideas for internships, jobs, grad school (e.g., MAS at PSU) Intro Career Courses Exams Club Internships

29 International Students
International students get jobs in US CPT/OPT/H1-B/Green cards/Eb5 really help If citizen or permanent resident, put near top of resume Communication as important as exams Join HW groups with US students Talk English all the time! Having US roommates has worked well Important to pass Exam P & FM in Sophomore year 3 exams to get Full-Time Job If can’t get internship or FT job, try grad school first See Club website on requirements for Grad School Recommendation Need good GPA & take RM 415 PSU has Masters in Applied Statistics (MAS). You can be a TA for RM 412 or 401 I think we should put this slides somewhere earlier. Intro Career Courses Exams Club Internships

30 Actuarial Science Club
Company Info Sessions (listed on Club’s Home Page) Exam Review Sessions (Club’s Review Sessions Page) Tutors for help on exams Field Trip to Actuarial Employers (Spring) Speakers Series: Int’l Actuarial Association President on 10/6 at 6pm; required attendance Social Events Panel Discussion of Alums from all Practice Areas We should also put: -Carpooling service -Some social events (list some names?) -Panel Discussion -International Student Meeting We can delete “Junior Liaisons” because we will introduce ourselves at the beginning of this meeting. Intro Career Courses Exams Club Internships

31 Actuarial Science Club
Club website: List Serve signup on Club home page – Very Important Facebook group Study Manual exchange Questions about Actuarial Exams & PSU Classes Social events Our Internships Intro Career Courses Exams Club Internships

32 Questions?


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