Which of the following risks is best mitigated by CLS?
A. currency risk
B. operational risk
C. liquidity risk
D. settlement risk
When differences in payment arise because of errors in the payment of funds:
A. claims should be made for the costs incurred by the injured party and include all administration costs
B. no party involved can be enforced to contribute to achieve an equitable resolution to the problem
C. no market participant should be unjustly enriched or injured by the action/error of another market participant
D. claims are calculated on the full principal amount of the failed payment with the interest rate imposed by the injured party
What does the Model Code say about omitting the "big figure" in voice communication?
A. The "big figure" should not be included in outright quotations.
B. In order to avoid misunderstandings, the "big figure" should not be mentioned when repeating the details (facts/rates) of the deal.
C. For the sake of brevity and efficiency, "big figures" should never be quoted at all in spot FX trading.
D. The Model Code recommends that the "big figure" be included in all outright and spot FX quotations.
A. The other dealer is bound to reciprocate.
B. This is not in any way an enforceable or binding commitment.
C. The Model Code does not comment on dealing reciprocity.
D. It is common market practice to suspend reciprocity in periods of high volatility.
Claims should be communicated in writing via e-mail or preferably by authenticated SWIFT. What information should be provided in the claim?
A. the details of the transaction involved, the number of days the payment was delayed and the resulting cost
B. the details of the transaction involved, the number of days the payment was delayed and the cost, together with Central Bank rate to be applied
C. the details of the transaction involved, the number of days the payment was delayed and the cost, together with reference rates to be applied
D. the details of the transaction involved, the number of days the payment was delayed and the cost,
together with the calculation methodology being claimed
Which of the following statements best describes the conditions under which a prime broker may accept a trade given up?
A. the trade is within the specified tenor limits
B. the trade is within the tenor limits and is of an applicable trade type
C. the trade is within the tenor limits and credit limits
D. the trade is within the tenor limits, credit limits and is of an applicable trade type
You are the buyer of a receiver's swap. All other things being equal your counterparty risk is increasing if
A. the swap curve is shifting downwards
B. the swap curve is shifting upwards
C. swaption volatilities are decreasing
D. time to expiry is becoming shorter
What does the Model Code recommend in respect of prices and orders made on electronic trading platforms?
A. They must be posted with a clear intent to be tradable.
B. They must be identified as indicative rates only.
C. They must be posted subject to later credit line approval.
D. They need not be posted in an appropriate trading style.
From 2019 on the total capital requirement for banks under Basel III will be defined as:
A. 8% of RWA plus conservation buffer
B. 10.5% of RWA plus conservation buffer
C. 8% of RWA plus countercyclical buffer
D. 10.5% of RWA plus countercyclical buffer
At the end of the day, you are short CHF 3,500,000.00 against SEK at 6.9275. You are asked to revalue your position at 6.9190. What is the resulting profit or loss?
A. Profit of CHF 29,750.00
B. Profit of SEK 29,750.00
C. Loss of SEK 29,750.00
D. Loss of CHF 29,750.00
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