Robin ravi gajria ima mathematics today review 6 regression modelling with acturial and financial applications

1. This text is part of the International Series on Actuarial Science from Cambridge University
Press, the Institute of Actuaries, and the Faculty of Actuaries; which seeks to provide textbooks
for students of acturial science and closely related fields, as well as provide some advanced
courses for continuing professional development and research.
The book itself focuses on helping readers who are hoping to become actuaries or financial
analysts learn about the statistical techniques of multiple regression and time series. An
understanding of risk management and finance are not prerequisites, merely a one term
university course in statistics and an interest in those fields are. Real world applications of the
methods discussed are introduced and explained in detail. Thus I felt the book was suitable for
the non- expert 'armchair actuary', to use Professor Rees' analogy, while also providing some
advanced topics towards the end. Indeed suggested courses are provided for readers having
four different ascending levels of prior knowledge, making the book suitable for long term use.
Optional exercises and suggestions for further reading are provided with most chapters, along
with technical supplements where relevant, to cover the mathematics behind the results, as Prof
Rees believes analysts must have an understanding of how and why the mathematical methods
they use work. Presumably a mathematical audience would agree with such an aim, and I think
this was achieved well.
The real world applications included throughout the theory are emphasised in that many of the
exercises contain real world data, and Professor Rees acknowledges the disadvantages of real
world data in that it can become outdated, and that variables are harder to isolate.
Links to SAS and R scripts from the book's website are provided throughout for the data
discussed, and this is done in text format to allow the reader to use other statistical programs if
they chose to.
On the whole as a non-specialist reader I feel the book achieved its aims well, while also
providing further material for specialists.
Robin Ravi Gajria
IMA
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