ACI Operations Certificate challenging v8.0 (3I0-013)

Page:    1 / 26   
Total 389 questions

Internationally, USD FRAs are settled with reference to which market rate?

  • A. LIBOR
  • B. FEDFUNDS
  • C. LIBID
  • D. EURIBOR


Answer : A

EURIBOR is a:

  • A. Daily fixing of EUR interest rates within the EMU zone
  • B. Daily fixing of EUR interest rates in London
  • C. A rate used for the settlement of USD FRAs between European counterparties
  • D. The official successor to LIBOR rates


Answer : A

An interest rate CAP can be defined as:

  • A. A series of American call options on FRAs
  • B. A series of European call options on FRAs
  • C. A series of American put options on FRAs
  • D. A series of European put options on FRAs


Answer : B

As to futures contracts:

  • A. The maintenance margin is a predetermined fraction of initial margin
  • B. The initial margin is a predetermined fraction of maintenance margin
  • C. The maintenance margin represents the brokerage costs
  • D. The maintenance margin represents management fees


Answer : A

Which of these statements is correct?

  • A. The strike price of a Bermudan option is an average.
  • B. A Bermudan option can be exercised only on a few specific dates prior to expiration.
  • C. A Bermudan option can be exercised at any time before its maturity date.
  • D. A Bermudan option can be exercised only at maturity.


Answer : B

You bought a 6x9 EUR 8,000,000.00 FRA at 0.75%. Settlement is now due and 3 months
(90 days) EURIBOR is 0.25%. What amount do you pay or receive?

  • A. Pay EUR 10,000.00
  • B. Receive EUR 10,000.00
  • C. Pay EUR 9,993.75
  • D. Receive EUR 9,993.75


Answer : C

What deals are usually associated with a collar?

  • A. A purchase of a cap and a sale of a cap at higher reference rate
  • B. A purchase of a floor and a sale of a cap or vice versa
  • C. A purchase of a cap and a purchase of a floor
  • D. A purchase of a step-up cap and a sale of a step-down floor


Answer : B

Which of the following is true about interest rate swaps (IRS)?

  • A. The fixed rate and the floating rate payers know the cash value of their payments at the outset
  • B. There is exchange of principal at the start and at the end of the swap
  • C. Payment netting is only allowed through a third party
  • D. The notional amount of the swap is generally not exchanged between counterparties


Answer : D

When is the settlement amount of a FRA normally payable?

  • A. At the beginning of the forward period
  • B. On the trade date
  • C. On the maturity (final) date
  • D. At any time before the contract’s maturity date


Answer : A

What financial product involves exchanging a fixed interest rate for a floating interest rate?

  • A. A FX Swap
  • B. A repurchase agreement
  • C. An interest rate swap (IRS)
  • D. A dual swaption


Answer : C

What is a junk bond?

  • A. An AAA-rated security in payment default
  • B. A sub-investment grade instrument
  • C. An OECD Government bond
  • D. A bond typically paying lower yields than an investment grade instrument


Answer : B

In a scenario where long-term interest rates are higher than short-term interest rates, the yield curve would best be described as:

  • A. Flat
  • B. Negative or inverse
  • C. Positive
  • D. Neutral


Answer : C

A USD 1,0000,000.00 US Treasury Bill (91 days) is offered at a discount rate of 0.75%.
The offer price will be:

  • A. USD 1,000,000.00
  • B. USD 998,104.17
  • C. USD 992,500.00
  • D. USD 998,130.14


Answer : B

Major amendments to a prospectus can be made:

  • A. At the discretion of the issuer and after the launch
  • B. Only with the consent of the note holders
  • C. Always in the case of default payment
  • D. Only by the custodian with the consent of the issuer


Answer : B

Which of the following are primary markets?

  • A. Auction markets conducted by the U.S. Treasury for U.S. Treasury bills
  • B. The repo market
  • C. The foreign exchange market
  • D. The over-the-counter market for U.S. Government Bonds


Answer : A

Page:    1 / 26   
Total 389 questions