From the following GBP deposit rates:
1M (31-day) GBP deposits 3.15% 2M (61-day) GBP deposits 3.25% 3M (91-day) GBP deposits 3.41% 4M (120-day) GBP deposits 3.56% 5M (152-day) GBP deposits 3.73% 6M (182-day) GBP deposits 3.90%
calculate the 3x4 forward-forward rate.
A. 3.410%
B. 3.977%
C. 3.996%
D. 3.997%
What is the risk of dealing through an agent with an unknown principal?
A. You may not be able to ensure that your firm can avoid suspicion of trading on non-public information or other allegations of bad or illegal trading practice.
B. You may not be able to net your exposure in an insolvency.
C. You may not be able to net your exposure for capital adequacy purposes.
D. All of the above.
Which of the following currencies is quoted on an actual/360 basis?
A. EUR
B. JPY
C. CHF
D. All of the above
When dealing with a fund manager, who will allocate shares in a transaction to his unknown clients after the transaction has been executed with you, you should:
A. Agree in writing with the fund manager that the allocation will be confirmed as soon as practicable after the transaction is executed.
B. Insist on the allocation being made and confirmed before the transaction is executed.
C. Agree in writing with the fund manager that he will guarantee the transaction until the allocation is confirmed.
D. Any of the above.
Management policy on the use of mobile devices by trading sales and settlement staff should:
A. Ban them from the dealing room or back office.
B. State whether they are allowed in the dealing room and back office, and can be used.
C. Ban their use in the dealing room or back office.
D. Restrict their use to senior management and authorised out-of-hours trading and sales staff.
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
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.
Where internet trading facilities are established by a bank for a client, the conditions and controls should be stated in a rulebook produced by:
A. The bank.
B. The local bankers association.
C. The local regulator.
D. Negotiation between the bank and client.
Where repos or securities lending transactions are entered into, the Model Code recommends:
A. Documentation should be in place beforehand.
B. Management should approve all transactions.
C. Copies of the underlying documentation should be lodged with regulators.
D. All of the above.
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:
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.
Where the Committee for Professionalism of the ACI has been notified of a breach of the letter or spirit of the Model Code, it
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.
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