Clients of a voice-broker quote EUR/GBP at 0.8345-50, 0.8346-51, 0.8348-53 and 0.8349-

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Clients of a voice-broker quote EUR/GBP at 0.8345-50, 0.8346-51, 0.8348-53 and 0.8349-
53. What will be the brokers price?
A. 0.8345-53
B. 0.8345-50
C. 0.8349-50
D. 0.8349-53

Answer : C


An option premium is normally a positive function of:
A. the traded volume
B. the historical volatility of the price of the underlying commodity
C. the style (European or American) of the option
D. the implied volatility of the price of the underlying

Answer : D


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

Answer : A



You are quoted the following rates:

Spot GBP/CHF 1.4535-45 -
3M GBP/CHF swap 22/19
At what rate can you sell GBP against CHF outright 3-month?
A. 1.4523
B. 1.4526
C. 1.4513
D. 1.4516

Answer : C



What are the secondary market proceeds of a CD with a face value of EUR 5,000,000.00 and a coupon of 3% that was issued at par for 182 days and is now trading at 3% but with only 7 days remaining to maturity?
A. EUR 4,997,085.03
B. EUR 5,000,000.00
C. EUR 5,071,086.45
D. EUR 5,072,874.16


Answer : D