Gambling or betting amongst market participants has obvious dangers and:
A. Should be forbidden.
B. Should be strongly discouraged.
C. Should be monitored by management.
D. All of the above.
Confirmations should be sent out by both counterparties through an efficient and secure means of communication, preferably electronic:
A. Within 24 hours of the deal.
B. Within two business days of the deal.
C. Before the value date.
D. As soon as possible.
Where answer phone equipment is used for reporting and recording of off-premises transactions, it should be:
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.
Brokers shall not reveal the identity of a counterparty unless:
A. They are forced to do so.
B. Explicitly authorised to do so by the counterparty.
C. They know the counterparty very well.
D. They are asked by their senior management to do so.
Which of the following statements reflects the Model Code on gambling or betting amongst market participants?
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.
When you are accepting a stop loss order, you must:
A. Ensure that your counterparty understands the terms under which your bank accepts the order.
B. Ensure that your counterpart can be contacted in the event of unusual situations or events or extremely volatile market conditions.
C. Ensure that your counterparty understands that any guarantee or fixed price execution requires agreement in writing.
D. All of the above.
Click on the Exhibit Button to view the Formula Sheet. Bank A pays for EURO 5 m at 1.1592. Bank B offers EURO 10 m at 1.1597. Broker XYZ quotes to the market EURO /USD 1.1592/97. Bank C takes the offer at 97. The broker is obliged to reveal:
A. The name of Banks A and B.
B. The name of Bank B only.
C. The amount that was bid but not the name of Bank A.
D. None of the above
Which of the following statements is true?
A. Banks should not ask brokers to disclose details of third party transactions unless they are between overseas principals.
B. Banks should not ask brokers to disclose details of third party transactions unless these transactions are already settled.
C. Banks should not ask brokers to disclose transactions between third parties in any circumstances.
D. Banks should not ask brokers for details of third party transactions unless senior management has approved.
Which of following is not true?
A. Inter-bank market participants have a duty to make absolutely clear whether the prices they are quoting are firm or merely indicative.
B. It is the duty of the dealer to periodically confirm with the broker the validity of his price.
C. It is the responsibility of the dealer to ensure that prices given to a broker are taken off if they have not been hit or were subject to a time limit.
D. No deal is done if one counterparty is unable to conclude a deal due to credit line problems and a name switch is not found within a reasonable period of time.
Written confirmation is a function that can be done by:
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.
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