The Actuarial Society

The existence of loans have revolutionized the world by allowing individuals or even companies that lack the required credit to lend it from a third party. A big portion of the current day businesses take debt to expand, invest in research or even counter their losses and money lenders like banks make revenue by giving out those debts and earning an interest over the returning period. Small loans are simple to handle and usually don’t require any additional steps other than the routine. Banks have set interest rates for different ranges of amounts. However, There are certain individuals that require loans of big amounts. Banks protect themselves from credit risk by holding an asset of the borrowers as collateral. If an individual or a firm is in need of a big loan from a bank, Then according to the Reserve Bank of India(RBI) a single bank cannot give more than a specified 50% of the loan amount.This arrangement setup by the RBI is called The banking consortium. Introduction to banking ...

Operational risk can be defined as "the risk of a change in value caused by the fact that actual losses, incurred for inadequate or failed internal processes, people, and systems, or from external events (including legal risk), differ from the expected losses.” In simpler words, it is a risk faced by a company due to failed internal processes such as those of a faulty system, unsuccessful procedures, employee errors, and legal hazards. Some other factors include technological glitches such as breaches of personal data resulting from cybersecurity attacks or risks tied with automation and artificial intelligence. These can also be caused due to physical catastrophes such as cyclones, earthquakes, or man-made events such as terrorism and vandalism. Operational risk includes all other risks except those of credit and market. These risks can be as minor as an affordable loss caused due to poor management of human error; for example, a poorly trained employee may lose a sales opportuni...

  RISK Our life is full of risks. Everyone in some way or other comes across a risk . We often hear  people around us saying “This investment is a risk” or “I took a risk by moving to a new country”. But what exactly is a risk? There are various ways to define it. However, the simplest explanation of risk is “the possibility of something bad happening.”  Risks come in all shapes and sizes. Financial risks are in the more prominent types of risks. People are hesitant in making investments with good returns as they are reluctant to bear the risk due to insufficient knowledge of risk management which makes it necessary to educate ourselves about these financial risks and learn to manage them for our financial independence. MARKET RISK One of the most crucial financial risks is “Market Risk”. As the name suggests, it is a risk that affects the entire financial market i.e. it affects entire industries as a whole. Basically, it is the risk of facing losses due to unfavorable ch...

“Self-driving cars are the natural extension of active safety and obviously, something we should do” ~ Elon Musk      Driving any vehicle safely requires a constant stream of quick accurate decisions from the driver, be it measuring the braking distance needed to stop at a point, gauging the distance from a specific object, or negotiating with traffic. In the absence of a driver in autonomous vehicles, the responsibility of making these critical decisions falls on the Artificial Intelligence (AI) controlling the vehicle. Therefore, it is crucial for the decision-making system to be extremely accurate. A significant role of the decision-making system is calculating probabilities, for example the probability of another vehicle entering the lane occupied by the car, a pedestrian crossing the road, or any other sudden obstruction on the road. Prediction by Models In order to predict the behavior of the surrounding cars, the AI in an autonomous car uses prediction algorithms b...

   Economics is the study of various factors that affect both nations and individuals. Statistics is one of the most important topics that governs modern economic theory and economic models, so much so that it has its own sub branch called ‘Economic Statistics’ or ‘Econometrics’. Econometrics is a subset of applied statistics that concerns itself with the collection, analysis, and processing of economic data. Various theories and principles have been developed by economists based on the deductive logic of production, distribution, trade, demand, price cycles, tax, etc. These theories are only of academic importance unless they are put through an empirical examination. Such theories can be compared to real-life scenarios using statistical analysis. Statistics is widely used by economists to analyze various social and economic phenomena and hence develop appropriate models that help us understand the economy better. It helps derive relationships between variables like price and ...

Football is the most popular and widely played sport on Earth, with over 5 billion people who are involved with the sport in one way or another. With such a vast audience, the footballing world has always incorporated new technological advances and innovation to the game to keep it interesting for the fans in a bid to create a sport that supersedes time. Statistics is a huge part of the game, the way it is played and the advances in technology that are being incorporated into the most widely played sport. Over the last decade, statistics has been incorporated heavily into football. Players and clubs now have data on their minute-to-minute performance which enables them to better improve their game and perform at their peaks for longer. Football has come a long way in terms of how it has been played over the past few decades and statistics and data analytics have been at the forefront of this change. The game of football revolves around numbers, from the simplest data such as goals scor...

                                                                             We have all had days when we wished we could just accurately predict the weather, may it be for our dinner dates or even a long vacation. But alas, nature isn't that predictable. It is complex to predict how the weather will behave in the coming hours, days, weeks and months. The only one thing we can do to get the best and closest results is to calculate the probabilities of the prevalence of particular weather conditions. But the question is how? Lets understand the process- We begin with gathering the observations from all around the world and then use these observations to set up a computer simulation of the atmosphere which represents what is happening in the world right now. The ...