March Special Sale - Limited Time 60% Discount Offer - Ends in 0d 00h 00m 00s - Coupon code: 575363r9

Welcome To DumpsPedia

3I0-012 Sample Questions Answers

Questions 4

You are short of 6 December EURODOLLAR futures contracts at 99.50. Yesterday, the closing price was 99.35. Today’s closing price is 99.105. What variation margin will be due?

Options:

A.

You will have to pay USD 5,925.00

B.

You will receive USD 5,925.00

C.

You will have to pay USD 3,675.00

D.

You will receive USD 3,675.00

Buy Now
Questions 5

Which of the following is the best description of a “broken trade”?

Options:

A.

when a trade has been agreed to with dates (maturities) different from the standard dates

B.

when one of the parties to the deal unilaterally decides to withdraw from the on-going transaction

C.

when, due to a system break, one or both parties to the deal chooses to withdraw from the ongoing transaction

D.

when, due to a system break, one or both parties to the deal are unclear as to whether the deal has been done

Buy Now
Questions 6

If I say that I have “bought and sold” EUR/USD in an FX swap, what have I done?

Options:

A.

Bought EUR and sold USD spot, and sold EUR and bought USD forward

B.

Bought USD and sold EUR spot, and sold USD and bought EUR forward

C.

Synthetically taken a USD loan in exchange for making a EUR loan with the same counterparty

D.

Sold EUR/USD spot and bought back EUR/USD forward

Buy Now
Questions 7

Which of the following statements about Credit Default Swaps (CDS) is correct?

Options:

A.

CDS are used to recover funds from defaulted swap counterparties.

B.

CDS provide protection against specified credit events to the party receiving the CDS premium payments.

C.

CDS provide protection against the default of the trade counterparty that buys the CDS.

D.

CDS provide compensation to the protection buyer, should a specified credit event occur to a third party entity.

Buy Now
Questions 8

How is an outright forward FX transaction quoted?

Options:

A.

pared points

B.

Depends on the term

C.

Depends on whether it is interbank or to a customer

D.

Depends on the currency pair

Buy Now
Questions 9

Which of the following is part of the typical scope of Asset Liability Management (ALM)?

Options:

A.

Selling distressed assets and investing in bank liabilities trading at distressed levels.

B.

Making sure that fixed assets are depreciated according to the applicable tax code.

C.

Planning the maturity structure and net funding requirements arising from banking book and trading book transactions.

D.

Planning the liability structure and net funding requirements arising from trading book assets carried at amortized cost.

Buy Now
Questions 10

The 180-day CAD/CHF rate is bid 62 and the 90-day CAD/CHF rate is bid 29. What is the bid rate for 120 days, assuming straight-line interpolation?

Options:

A.

33

B.

42

C.

27

D.

40

Buy Now
Questions 11

What is settlement risk in FX?

Options:

A.

The risk of failure of a payments or settlement system

B.

The risk that only one side of an exchange of currencies will be made

C.

The risk of payments ‘gridlock’ in a real-time gross settlement system

D.

The risk that default by a counterparty before the value date means you have to replace the defaulted deal at a worse rate

Buy Now
Questions 12

What should be done when a voice broker calls “off” at the very instant the dealer hits the broker’s price as “mine” or “yours”?

Options:

A.

The transaction should be concluded and the broker should inform both counterparties accordingly.

B.

The dealer who hits the broker’s price may decide whether the deal is done or not; the broker should inform both counterparties accordingly.

C.

The deal should not be concluded and the broker should inform both counterparties accordingly.

D.

The broker should immediately inform both counterparties that the deal will have to berenegotiated.

Buy Now
Questions 13

A sold JUN 3-month STIR-future should be reported in the gap report as of 22 May:

Options:

A.

as a given deposit with a term of one month and a taken deposit with a term of four months

B.

as a taken deposit with a term of one month

C.

as a taken deposit with a term of one month and a given deposit with a term of four months

D.

as a given deposit with a term of four months

Buy Now
Questions 14

With reference to dealing periods, what does the term “short dates” refer to?

Options:

A.

overnight, tom-next and spot-next

B.

maturities up to one week

C.

maturity dates of less than one month

D.

maturity dates of less than 10 days

Buy Now
Questions 15

Which of the following statements reflects the Model Code on gambling or betting amongst market participants?

Options:

A.

Gambling and betting between market participants should be strongly discouraged.

B.

Gambling and betting between market participants can be allowed if it is monitored by management.

C.

Gambling and betting between market participants should be forbidden.

D.

All of the above.

Buy Now
Questions 16

Written confirmation is a function that can be done by:

Options:

A.

Any dealer as long as he/she is not a party to the trade.

B.

Staff in the back-office.

C.

Staff in the dealing room who are not dealing.

D.

Any staff outside the dealing room.

Buy Now
Questions 17

Which type of repo is the least risky for the buyer?

Options:

A.

Delivery repo

B.

HlC repo

C.

Tri-party repo

D.

There is no real difference

Buy Now
Questions 18

The popularity of FX-trading via Internet platforms has serious implications for the applicability of traditional rules such as “Know Your Customer”. Which of the following are correct?

Options:

A.

“Know Your Customer” rules cannot be applied online and banks will have to rely instead on new safeguards such as third-party authentication.

B.

“Know Your Customer” rules apply only to retail customers and are therefore irrelevant to currency trading.

C.

In practice, banks can avoid “Know Your Customer” rules by limiting online deal size to EUR 100,000.00 or equivalent.

D.

No trading should be carried out without first identifying and setting up the counterparty; this includes “Know Your Customer” procedures.

Buy Now
Questions 19

Which of the following statements is correct?

Options:

A.

With liquidity transfer pricing (LTP) banks attribute the costs, benefits and risks of liquidity to respective business units within a bank

B.

With liquidity transfer pricing (LTP) banks are monitoring and diversifying their funding base

C.

With liquidity transfer pricing (LTP) banks are agreeing with external liquidity providers on the fair market price of funds

D.

Liquidity transfer pricing charges providers of funds for the cost of liquidity and users of funds for the benefit of liquidity

Buy Now
Questions 20

The columns below list short-term cash rates on 3rd April and 3rd F1ay 3rd April 3rd May

Describe the shape of the short-term segment of the yield curve on 3’ April using market terminology. In addition, describe the change in the shape of the curve between 3rd April and 3rd May.

Options:

A.

Positive, steepening

B.

Positive, flattening

C.

Inverted, steepening

D.

Inverted, flattening

Buy Now
Questions 21

Which of the following statements is correct regarding duration?

Options:

A.

It is a measure of the average price of a financial instrument.

B.

It doesn’t take into account the timing and market value of cash flows.

C.

It increases if the average coupon increases.

D.

It decreases as maturity decreases

Buy Now
Questions 22

Under new Basel rules, what is the meaning of CVA?

Options:

A.

Credit Value Adaption

B.

Call Value Adaption

C.

Credit Value Adjustment

D.

Counterpart Value Adjustment

Buy Now
Questions 23

USD/CHF is quoted to you at 0.9290-93 and GBP/USD at 1.5320-30. At what rate could you buy GBP and sell CHF?

Options:

A.

1.4242

B.

1.4232

C.

1.4246

D.

1.4237

Buy Now
Questions 24

Which one of the following statements about mark-to-model valuation is correct?

Options:

A.

Mark-to-model valuation is used for exchange-traded positions to ensure correct pricing.

B.

Asset managers are not allowed to use mark-to-model valuation.

C.

Mark-to-model valuation is used for complex financial instruments; it is always accurate and in line with potential tradable prices.

D.

Mark-to-model valuation refers to prices determined by financial models, rather than actual market prices.

Buy Now
Questions 25

If GBP/USD is 1.5350-53 and USD/JPY is 97.50-53, what is GBP/JPY?

Options:

A.

149.66-74

B.

149.69-71

C.

63.52-53

D.

63.51-54

Buy Now
Questions 26

You have quoted your customer the following CAD deposit rates:

1M 1.00-05%

2M 1.06-11%

3M 1.13-18%

The customer says, “I give you CAD 20,000,000.00 in the two’s”. What have you done?

Options:

A.

Borrowed CAD 20,000,000.00 at 1.06%

B.

Lent CAD 20,000,000.00 at 1.11%

C.

Borrowed CAD 20,000,000.00 at 1.11%

D.

Lent CAD 20,000,000.00 at 1.06%

Buy Now
Questions 27

What would be the strategy for a bank if it is unable to speculate on interest rates and/or unable to absorb market risk?

Options:

A.

to run a zero gap

B.

to hold more interest rate sensitive assets than interest rate sensitive liabilities

C.

to reduce the size of the balance sheet

D.

to hold fewer interest rate sensitive assets than interest rate sensitive liabilities

Buy Now
Questions 28

What should a broker do if his quoted price is hit simultaneously by several dealers for a total amount greater than that for which the price concerned was valid?

Options:

A.

allot the amount for which the price is valid pro rata amongst some principals in accordance with the amount proposed by each and inform the other dealers that “nothing was done”

B.

decide which principals he will allot the amount for which the price is valid and inform the other dealers that “nothing was done”

C.

evenly allocate the amount for which the price is valid amongst all the principals and inform all the relevant dealers

D.

apportion the amount for which the price is valid pro rata amongst all the principals concerned in accordance with the amount proposed by each and inform all the relevant dealers

Buy Now
Questions 29

EURIBOR is the:

Options:

A.

Daily fixing of EUR interbank deposit rates in the European market

B.

Daily fixing of EUR interbank deposit rates in the London market

C.

Another name for EUR LIBOR

D.

The ECB’s official repo rate

Buy Now
Questions 30

What usually happens to the collateral in a tri-party repo?

Options:

A.

It is put at the disposal of the buyer

B.

It is held by the seller in the name of the buyer

C.

It is held by the tn-party agent in the name of the buyer

D.

It is frozen in the sellers account with the tri-panty agent

Buy Now
Questions 31

Voice-brokers in spot FX are remunerated with:

Options:

A.

Commission paid by both parties at rates agreed beforehand

B.

A fee paid by the seller

C.

Bid/offer spread

D.

A share of the bid/offer spread

Buy Now
Questions 32

Which position below is NOT a component of common equity Tier 1 capital?

Options:

A.

innovative hybrid capital instruments with incentives to redeem

B.

common shares issued by bank

C.

retained earnings

D.

stock surplus (share premium)

Buy Now
Questions 33

You have just sold USD 5,000,000.00 spot against JPY. What type of risk does not apply?

Options:

A.

Market risk

B.

Settlement risk

C.

Basis risk

D.

Credit risk

Buy Now
Questions 34

The intrinsic value of a long call option:

Options:

A.

Falls and rises with the price of the underlying commodity, but is always positive

B.

Rises if the price of the underlying commodity falls and vice versa

C.

Depends solely on the volatility of the price of the underlying commodity

D.

Becomes negative if the market price of the underlying commodity falls below the strike price of the option

Buy Now
Questions 35

You are paying 1,00% per annum paid semi-annually and receiving 6-month LIBOR on a USD 10,000,000.00 interest rate swap with exactly two years to maturity. 6-month LIBOR for the next payment date is fixed today at 0.95%. How would you hedge the swap using FRAs?

How to hedge an IRS with a strip of FRAs?

Options:

A.

buy a strip of 0x6, 6x12, 12x18 and 18x24 FRAs

B.

sell a strip of 0x6, 6x12, 12x18 and 18x24 FRAs

C.

buy a strip of 6x12, 12x18 and 18x24 FRAs

D.

sell a strip of 6x12, 12x18 and 18x24 FRAs

Buy Now
Questions 36

Your GBP/CHF rate is 1.3710-15. How many GBP would your customer have to give you to buy CHF 10,000,000.00?

Options:

A.

7,291,286.91

B.

7,293,946.02

C.

13,710,000.00

D.

13,715,000.00

Buy Now
Questions 37

What is the day count/annual basis convention for JPY money market deposits?

Options:

A.

ACT/365

B.

ACT/360

C.

ACT/ACT

D.

30E/360

Buy Now
Questions 38

Today is Monday, 8th December. You sell a 9x12 USD FRA for value Thursday, 10th September next year. On what date is the settlement amount due to be paid or received (assuming that there are no holidays)?

Options:

A.

8th September next year

B.

10th September next year

C.

8thDecembernextyear

D.

December next year

Buy Now
Questions 39

Where answer phone equipment is used for reporting and recording of off-premises transactions, it should be:

Options:

A.

On an special number known only to the chief dealer.

B.

On a number located in the office of the internal auditor.

C.

Secured so that reported transactions cannot be erased without senior management approval.

D.

Secured by recordings that are stored for a suitable period.

Buy Now
Questions 40

An option granted by the seller that gives the buyer the right to enter into an underlying interest rate swap transaction is ca lied:

Options:

A.

a swap

B.

a cap

C.

a swaption

D.

a collar

Buy Now
Questions 41

A forward-forward loan creates an exposure to the risk of:

Options:

A.

Higher interest rates

B.

Lower interest rates

C.

Steepening yield curve

D.

Parallel shift downwards in the yield curve

Buy Now
Questions 42

If the daily 90% confidence level VaR of a portfolio is correctly estimated to be USD 5,000.00, one would expect that:

Options:

A.

in 1 out of 10 days, the portfolio value will decline by USD 5,000.00 or less.

B.

in 1 out of 90 days, the portfolio value will decline by USD 5,000.00 or less.

C.

in 1 out of 10 days, the portfolio value will decline by USD 5,000.00 or more.

D.

in 1 out of 90 days, the portfolio value will decline by USD 5,000.00 or more.

Buy Now
Questions 43

What is the day count/annual basis convention for euroyen deposits?

Options:

A.

Actual/365

B.

Actual/360

C.

Actual/actual

D.

30E/360

Buy Now
Questions 44

A dealer has indicated his intention of assigning an interest rate swap to a third party soon after transacting that swap. When about to execute an assignment

Options:

A.

The dealer is entitled to provide the name of the original counterparty to the assignee.

B.

The dealer is entitled to provide the name of the assignee to the original counterparty.

C.

The dealer should seek the permission of the assignee before releasing the name to the original counterparty.

D.

The dealer should seek the permission of the original counterparty before releasing the name to the assignee.

Buy Now
Questions 45

When quoting the exchange rate between the USD and AUDI which is conventionally the base currency?

Options:

A.

USD

B.

AUD

C.

Depends on whether the price is being quoted in Australia or the US

D.

Depends on whether the price is being quoted interbank or to a customer

Buy Now
Questions 46

A forward/forward FX swap:

Options:

A.

is a contract by which the maturity of a regular FX swap can be extended at an historic (noncurrent) rate

B.

is a swap transaction where the near leg is traded either value today or value tomorrow and the far leg is traded spot

C.

is a swap that does not start spot and where both the near and the far leg are traded forward

D.

is a transaction by which a maturing outright forward FX is prolonged at an historic (non-current) rate

Buy Now
Questions 47

You want to hedge your deposit against falling interest rates. Which of the alternatives below are appropriate for this purpose?

Options:

A.

Selling a Money Market Future and/or selling a Forward Rate Agreement

B.

Buying a Money Market Future and/or buying a Forward Rate Agreement

C.

Selling a Money Market Future and/or buying a Forward Rate Agreement

D.

Buying a Money Market Future and/or selling a Forward Rate Agreement

Buy Now
Questions 48

The buyer of a currency put option has:

Options:

A.

Substantial opportunity for gain and limited risk of loss

B.

Substantial risk of loss and substantial opportunity for gain

C.

Limited risk of loss and limited opportunity for gain

D.

Substantial risk of loss and limited opportunity for gain

Buy Now
Questions 49

You bought a CAD 8,000,000.00 6x9 FRA at 1.95%. The settlement rate is 3-month (90-day) BBA LIBOR, which is fixed at 0.9500%.

What is the settlement amount at maturity?

Options:

A.

You pay CAD 20,000.00

B.

You receive CAD 20,000.00

C.

You pay CAD 19,952.61

D.

You receive CAD 19,952.61

Buy Now
Questions 50

From the following GBP deposit rates:

1M (30-day) GBP deposits 0.45%

2M (60-day) GBP deposits 0.50%

3M (91-day) GBP deposits 0.55%

4M (123-day) GBP deposits 0.65%

5M (153-day) GBP deposits 0.70%

6M (184-day) GBP deposits 0.75%

Calculate the 3x4 forward-forward rate.

Options:

A.

0.60%

B.

0.949%

C.

1.074%

D.

0.933%

Buy Now
Questions 51

You quote a customer a spot cable 1.6050-55 in USD 3,000,000.00. If they sell USD to you, how much GBP will you be short of?

Options:

A.

4,816,500.00

B.

1,869,158.88

C.

1,868,57677

D.

4,815,000.00

Buy Now
Questions 52

What is the correct interpretation of a EUR 2,000,000.00 overnight VaR figure with a 97% confidence level?

Options:

A.

A loss of at least EUR 2,000,000.00 can be expected in 97 out of the next 100 days.

B.

A loss of at most EUR 2,000,000.00 can be expected in 3 out of the next 100 days.

C.

A loss of at least EUR 2,000,000.00 can be expected in 3 out of the next 100 days.

D.

A loss of at most EUR 2,000,000.00 can be expected in 6 out of the next 100 days.

Buy Now
Questions 53

A bank that has quoted a firm price is obliged to deal:

Options:

A.

At that price

B.

At that price in a marketable amount

C.

At that price in a marketable amount, provided the counterparty’s name is acceptable

D.

At that price in a marketable amount, provided the counterparty’s name is acceptable and the market price has not moved excessively

Buy Now
Questions 54

What is the maximum maturity of an unsecured USCP?

Options:

A.

One year

B.

270 days

C.

183 days

D.

5 years

Buy Now
Questions 55

Which of the following statements is true concerning dealing and rollovers at non-current rates?

Options:

A.

When setting the rates for an FX swap to extend the maturity, the spot rate should be fixed immediately within the current spread

B.

Where the use of non-current rates may be necessary, they should only be entered into with the prior explicit permission of the quoting party’s senior management

C.

Dealing and rollovers at non-current rates are relatively common market practice and therefore should not be treated differently from any other transaction

D.

Dealing and rollovers at non-current rates are forbidden as they can help perpetrate fraud and tax evasion

Buy Now
Questions 56

What is the amount of the principal plus interest due at maturity on a 1-month (32-day) deposit of USD 50,000,000.00 placed at 0.37%?

Options:

A.

EUR 50,015,416.67

B.

EUR 50,016,219.18

C.

EUR 50,016,444.44

D.

EUR 50,016,958.33

Buy Now
Questions 57

The market is quoting:

6-month (182-day) CAD 1.25%

12-month (366-day) CAD 1.55%

What is the 6x12 rate in CAD?

Options:

A.

0.300%

B.

0.946%

C.

1.935%

D.

1.835%

Buy Now
Questions 58

You have taken 3-month deposits of EUR 10,000,000.00 at 0.60%, EUR 5,000,000.00 at 0.40% and EUR 5,000,000.00 at 0.50%.

What is the average rate of your long position?

Options:

A.

0.525%

B.

0.45%

C.

0.75%

D.

0.375%

Buy Now
Questions 59

If a dealer has a 6-month USD asset and a 3-month USD liability, how could he hedge his balance sheet exposure in the FRA market?

Options:

A.

Buy 3x6

B.

Sell 3x6

C.

Buy 0x6

D.

Sell 6x9

Buy Now
Questions 60

Which Greek letter is used to describe the ratio of change in the option price compared with change in the price of the underlying instrument, when all other conditions are fixed?

Options:

A.

beta

B.

gamma

C.

delta

D.

theta

Buy Now
Questions 61

In GBP/CHF, you are quoted the following prices by four different banks. You are a buyer of CHF. Which is the best quote for you?

Options:

A.

1.4340

B.

1.4343

C.

1.4337

D.

1.4335

Buy Now
Questions 62

Which one of the following statements about interest rate movements is true?

Options:

A.

An upward parallel shift of interest rates will cause a loss of income if the rate-sensitivity of a bank’s liabilities is higher than the rate-sensitivity of its assets.

B.

A bank will lose income if it has more rate-sensitive liabilities than rate-sensitive assets.

C.

Falling interest rates will always result in mark-to-market profits on short positions in fixed rate securities.

D.

Rising interest rates can result in mark-to-market losses on fixed-rate assets.

Buy Now
Questions 63

Clients of a voice-broker quote EUR/USD at 1.3556-61, 1.3559-62, 1.3557-63 and 1.3555-59.

What will be the broker’s price?

Options:

A.

1.3559 choice

B.

1.3555-63

C.

1.3559-62

D.

1.3556-59

Buy Now
Questions 64

An option is:

Options:

A.

The right to buy or sell a commodity at a fixed price

B.

The right to buy a commodity at a fixed price

C.

The right but not the obligation to buy or sell a commodity at a fixed price

D.

The right but not the obligation to buy a commodity at a fixed price

Buy Now
Questions 65

A US security yields 7% on an annually-compounded bond basis. What is the equivalent annually- compounded money market yield?

Options:

A.

7.09%

B.

7.03%

C.

6.90%

D.

6.95%

Buy Now
Questions 66

You quote a price to a broker. It is hit by another bank, but you are not informed until some time afterward that the deal has been done. Who is to blame?

Options:

A.

You are, as it is your responsibility to check periodically that the price has not been dealt upon.

B.

The broker is, as he must immediately tell you that your price has been dealt upon.

C.

The other bank is, since it did not immediately seek confirmation.

D.

All the parties, particularly you and the other bank.

Buy Now
Questions 67

An option contract that gives the buyer the right to exercise the option at several distinct points during its life is called:

Options:

A.

European-style option

B.

American-style option

C.

Bermudan option

D.

Asian option

Buy Now
Questions 68

Complete the following sentence. If a bank has an asset repricing in 6 months funded by a liability repriced in 3 months:

Options:

A.

the bank would benefit from higher interest rates

B.

the bank could hedge this interest rate risk with a 3x6 derivative

C.

the bank will make mark-to-market losses if rates decrease

D.

the bank could hedge this interest rate risk by selling a 6x9 derivative

Buy Now
Questions 69

In interbank trading, if a dealer is calling “off” at the same time as the broker is hitting a price:

Options:

A.

no transaction should be concluded and the broker should inform both counterparties accordingly

B.

a transaction should be concluded and the broker should inform both counterparties accordingly

C.

the dealer has the choice of either concluding the transaction or not

D.

the broker decides whether the transaction should be concluded or not

Buy Now
Questions 70

Which of the following are specifically quoted in terms of a yield-to-maturity?

Options:

A.

US Treasury bill

B.

CD

C.

Interbank deposit

D.

USCP

Buy Now
Questions 71

Your are quoted the following rates:

Spot CHF/JPY105.12-22

3M CHF/JPY 3.5/4.5

At what rate can you buy 3-month outright JPY against CHF?

Options:

A.

105.085

B.

105.265

C.

108.62

D.

105.155

Buy Now
Questions 72

3-month EUR/USD FX swaps are quoted to you at 8/12. If the “points are in your favor”, what have you done?

Options:

A.

Bought and sold 3-month EUR/USD through the swap

B.

Sold and bought 3-month EUR/USD through the swap

C.

Made the quote

D.

Cannot say

Buy Now
Questions 73

A Eurodollar futures price of 99.685 implies:

Options:

A.

A forward-forward rate of 0.685%

B.

A forward-forward rate of 0.315%

C.

Current 3-month LIBOR of 0.6850%

D.

Current 3-month LIBOR of 0.3150%

Buy Now
Questions 74

A euro zone-based bank that is asset-sensitive to market interest rate changes might reduce interest rate risk by:

Options:

A.

entering into a pay fixed I receive variable standard interest rate swap

B.

entering into a receive fixed I pay variable standard interest rate swap

C.

entering into a pay fixed / receive variable amortizing interest rate swap

D.

entering into a GBP/USD FX swap

Buy Now
Questions 75

Whose compliance rules, regulations and best practices should be followed in FX electronic trading?

Options:

A.

solely those of the electronic trading platforms vendors

B.

exclusively ACI’s Model Code Best Practices

C.

ACI’s Model Code Best Practices and ICMA’s Market Practice & Regulatory Policy

D.

the electronic trading platforms vendors’ and the ACIs Model Code Best Practices guidelines

Buy Now
Questions 76

What is a short straddle option strategy?

Options:

A.

A long call option + long put option with the same strike prices

B.

A short call option + short put option with the same strike prices

C.

A long call option + short put option with the same strike prices

D.

A short call option + long put option with the same strike prices

Buy Now
Questions 77

What is the ISO code for the currency of China?

Options:

A.

CHY

B.

CNR

C.

CHR

D.

CNY

Buy Now
Questions 78

If you sell USD 3-month forward to a client against EUR, what should you do to hedge your position?

Options:

A.

Buy a 3-month EUR/USD outright forward

B.

Buy USD spot, and sell and buy a 3-month EUR/USD FX swap

C.

Sell EUR/USD in the spot market, lend EUR for 3 months and borrow USD for 3 months

D.

Sell EUR/USD in the spot market, borrow EUR for 3 months and lend USD for 3 months

Buy Now
Questions 79

Spot EUR/USD is 1.3050-53 and EUR interest rates are lower than USD interest rates. Would you expect the forward points for EUR/USD to be:

Options:

A.

added to spot

B.

subtracted from spot

C.

a negative value

D.

Insufficient information to decide

Buy Now
Questions 80

Automated trading systems for interbank spot FX display the best prices entered into the systems by users and:

Options:

A.

Display the names of those users along their prices

B.

Offer pre-trade anonymity to users quoting prices

C.

Offer pre and post-trade anonymity to users quoting prices

D.

Offer users the choice of whether to remain anonymous

Buy Now
Questions 81

The extension of forward FX contracts at their historic rates is only allowed when:

Options:

A.

Prior management approval has been sought.

B.

They are executed within six months.

C.

They are extended for not more than one year.

D.

All of the above.

Buy Now
Questions 82

You have quoted a Swiss customer spot USD/CHF as 1.3710-15, but he asks you to quote it as CHF/USD. What do you quote?

Options:

A.

0.7291-94

B.

0.7294-91

C.

1.3710-15

D.

None of these

Buy Now
Questions 83

What is a long straddle option strategy?

Options:

A.

A long call option + long put option with the same strike prices

B.

A short call option + short put option with the same strike prices

C.

A long call option + short put option with the same strike prices

D.

A short call option + long put option with the same strike prices

Buy Now
Questions 84

The Chairman and members of the ACls Committee for Professionalism are ready to assist in resolving disputes through the ACIs Expert Determination Service in situations where:

Options:

A.

The amount of the deal exceeds EUR 5 million.

B.

The local regulator or central bank declines to intervene.

C.

Litigation has already commenced.

D.

At the request of one of the counterparties.

Buy Now
Questions 85

You and a dealer at another bank have an informal bilateral reciprocal arrangement to quote each other two-way prices. During periods of high volatility, the other dealer refuses to quote to you. The Model Code states that

Options:

A.

The other dealer should act with honour, honesty and integrity.

B.

It is a purely matter for your two institutions.

C.

Such arrangements are not in any way enforceable or binding.

D.

All of the above.

Buy Now
Questions 86

You are quoted the following market rates:

spot EUR/USD. 1.2250

3M (91-day) EUR 2.55%

3M (91-day) USD. 2.00%

What is 3-month EUR/USD?

Options:

A.

1.2232

B.

1.2233

C.

1.2234

D.

1.2267

Buy Now
Questions 87

Bank XYZ calls you for a quote in EUR/USD for EURO 20 million. If you decide to quote to Bank XYZ:

Options:

A.

You must be prepared to deal up to EUR 20 million.

B.

You may quote without stating the amount you are prepared to deal.

C.

You are only committed to deal in a marketable amount.

D.

None or the above.

Buy Now
Questions 88

The two-week repo rate br the 5.25% bund 2007 is quoted to you at 3.33-38%. You agree to reverse in bonds worth EUR 266,125,000 with no initial margin. You would earn repo interest ot

Options:

A.

EUR 349,806

B.

EUR 344,632

C.

EUR 319,315

D.

EUR 324,110

Buy Now
Questions 89

Are the forward points materially affected by changes in the spot rate?

Options:

A.

never

B.

Only for very large movements and longer terms

C.

always

D.

spot is the principal influence

Buy Now
Questions 90

What is the value date of a 6-month outright forward FX transaction dealt today, if todays spot date is Monday, 30th June? Assume there are no bank holidays.

Options:

A.

27th December

B.

30th December

C.

31stDecember

D.

1st January

Buy Now
Questions 91

You are quoted the following market rates:

spot EUR/GBP 0.6670

6M (182-day) EUR 2.35%

6M (182-day) GBP 375%

What is 6-month EUR/GBP?

Options:

A.

0.6675

B.

0.6715

C.

0.6717

D.

0.6718

Buy Now
Questions 92

A dealer needs to buy USD against SGD. Of the following rates quoted to him, which is the best rate for him?

Options:

A.

1.4323-26

B.

1.4320-25

C.

1.4315-20

D.

1.4318-23

Buy Now
Questions 93

3-month USD/CHF is quoted at 112/110. Interest rates in Switzerland are reduced but USD rates (which are higher) are unchanged. What would you expect the 3-month forward USD/CHF rate to be?

Options:

A.

unchanged

B.

118/116

C.

109/107

D.

106/104

Buy Now
Questions 94

The premium on an option contract is:

Options:

A.

The price of the underlying commodity at the time of the transaction

B.

The price at which the transaction on the underlying commodity will be carried out if and when the option is exercised

C.

The price the buyer of the option pays to the seller when entering into the options contract

D.

The price at which the two counterparties can close-out their position

Buy Now
Questions 95

Click on the Exhibit Button to view the Formula Sheet. You are short of 6 Dec euro dollar futures contracts at 98.10. Yesterday, the closing price was 98.15. Today’s closing price is 97.905.Whatvariation margin will be due?

Options:

A.

You will have to pay USD 612.50

B.

You will receive USD 612.50

C.

You will have to pay USD 3,675.00

D.

You will receive USD 3,675.00

Buy Now
Questions 96

Where the Committee for Professionalism of the ACI has been notified of a breach of the letter or spirit of the Model Code, it

Options:

A.

Will examine the complaint.

B.

May consult with the local ACI.

C.

Will bring the matter to the attention of the local regulator.

D.

None of the above.

Buy Now
Questions 97

What is the ISO code for platinum?

Options:

A.

XAU

B.

XAG

C.

XPT

D.

XPD

Buy Now
Questions 98

The Model Code is clear on “position parking”. What does it say?

Options:

A.

The parking of deals or positions with any counterparty is discouraged B. The parking of deals or positions with any counterparty should be forbidden

B.

The parking of deals or positions should be subject to a clear policy laid down in writing by senior management

C.

In jurisdictions where position parking is allowed, prior approval should be sought from the regulator

Buy Now
Questions 99

Under Basel rules the risk weight for AM-rated claims on corporates in the standardized approach is:

Options:

A.

0%

B.

15%

C.

20%

D.

75%

Buy Now
Questions 100

In FX trading a “third party beneficiary” is best described as:

Options:

A.

the issuer of a payment for the relevant trade distinct from the counterparty

B.

the issuer of a payment for the relevant trade identical to the counterparty

C.

the recipient of a payment for the relevant trade distinct from the counterparty

D.

the recipient of a payment for the relevant trade identical to the counterparty

Buy Now
Questions 101

Which of the following is a characteristic of all liquid assets under Basel III?

Options:

A.

uncertainty of valuation

B.

high correlation with risky assets

C.

listed on a developed and recognized exchange

D.

readily marketable

Buy Now
Questions 102

Which of the following statements about Eurodollar deposits is correct?

Options:

A.

Eurodollar deposits can only be dealt by banks in the USA

B.

US withholding tax applies to Eurodollar deposits

C.

Eurodollar deposits are free of US reserve requirements

D.

Eurodollar deposits are subject to US exchange controls

Buy Now
Questions 103

The one-month (31-day) GC repo rate for French government bonds is quoted to you at 3.75- 80%. As collateral, you are offered EUR 25,000,000.00 nominal of the 5.5% OAT April 2015, which is worth EUR 28,137,500.00. If you impose an initial margin of 1%, the Repurchase Price is:

Options:

A.

EUR 27,947,276.43

B.

EUR 27,946,077.08

C.

EUR 27,950,071.43

D.

EUR 27,948,871.97

Buy Now
Questions 104

You are quoted the following rates:

Spot USD/JPY97.10-15

3M USD/JPY swap 9/6

Spot USD/CHF 0.9320-23

3M USD/CHF swap 11/8

Where can you sell CHF against JPY 3-month outright?

Options:

A.

104.14

B.

104.21

C.

104.23

D.

104.30

Buy Now
Questions 105

When is your settlement risk greatest on a spot FX deal?

Options:

A.

Today

B.

Tomorrow

C.

After you make an irrevocable payment

D.

On the spot value date

Buy Now
Questions 106

From the following CAD rates:

1M (31-day) CAD deposit 0.95%

1x2 CAD (30-day) FRA 1.21%

2x3 CAD (31-day) FRA 2.01%

Calculate the 3-month implied cash rate.

Options:

A.

1.42%

B.

1.39%

C.

2.01%

D.

4.21%

Buy Now
Questions 107

You quote your customer EUR/USD 1.3070-73, However they need the rate quoted in EUR per USD. What do you quote?

Options:

A.

1.3073-70

B.

0.7651-49

C.

0.7646-49

D.

0.7649-51

Buy Now
Questions 108

If the value of the collateral in a repo has fallen during the term of the transaction, who suffers the loss?

Options:

A.

Seller

B.

Buyer

C.

Issuer

D.

It depends on the agreement between the buyer and seller

Buy Now
Questions 109

What do you call a combination of a long (short) call option and short (long) put option with same face value, same expiration date, same style, where the strike price is equal to the forward price?

Options:

A.

a synthetic forward

B.

a straddle

C.

risk reversal

D.

a strangle

Buy Now
Questions 110

Between which departments are clear and structured escalation procedures required for the management of incorrect funding balances?

Options:

A.

Nostro reconciliations, the Cash Management Department and Operations

B.

Front Office, the Cash Management Department and Operations

C.

Front Office, Nostro reconciliations and Operations

D.

Front Office, Nostro reconciliations and the Cash Management Department

Buy Now
Questions 111

A bank expects interest rates to fall with a parallel downward shift in the yield curve. What action should the bank take, if it wants to benefit from this view?

Options:

A.

increase the maturity of its liabilities

B.

reduce the maturity of its asset portfolio

C.

runazerogap

D.

lengthen the maturity of its asset portfolio

Buy Now
Exam Code: 3I0-012
Exam Name: ACI Dealing Certificate
Last Update: Mar 22, 2024
Questions: 740
$64  $159.99
$48  $119.99
$40  $99.99
buy now 3I0-012