3I0-012 ACI Dealing Certificate exact Exam Questions

ACI Dealing Certificate

Last Update 4 hours ago Total Questions : 740

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Question # 16

A disgruntled customer claims that he should not have to settle an FRA with you because it is really just a wager. What type of risk are you exposed to?

Credit risk

Legal risk

Settlement risk

Basis risk

Question # 17

Under Basel rules, what is the meaning of LGD?

Loss Given Default

Liquidity Given Distress

Limit Given Default

Loss Given Distress

Question # 18

A prime broker may not reject a trade given up if:

the trade is not within the specified tenor limits

the trade is not within the specified credit limits

the trade details provided by the executing dealer and the client match

the trade is a permitted transaction type as specified in the give-up agreement with the executing dealer

Question # 19

What is replacement cost a function of?

Credit risk

Market risk

Both of the above

None of the above

Question # 20

If EUR/USD is 1.1025-28 and the 6-month swap is 112.50/113, what is the 6-month outright price?

1.1380-1.11405

1.11375-1.1141

1.09125-1.0915

None of these

Question # 21

The premium on an option contract is:

The price of the underlying commodity at the time of the transaction

The price at which the transaction on the underlying commodity will be carried out if and when the option is exercised

The price the buyer of the option pays to the seller when entering into the options contract

The price at which the two counterparties can close-out their position

Question # 22

The delta of an at-the-money long call option is:

Between +0.5 and +1

+0.5

Between 0 and +0.5

Zero

Question # 23

Lending for 3 months and borrowing for 6 months creates a 3x6 forward-forward deposit. The cost of that deposit is called:

Break-even rate

Implied rate

Forward-forward rate

All of the above

Question # 24

You are quoted spot NZD/USD 0.6821-26 and USD/CHF 1.4652-56 at what price can you buy CHF against NZD?

0.9993

1.0006

1.0007

0.9994

Question # 25

What type of institution is the typical issuer of bank bills?

Credit institution

lnvestment bank

Corporate

All of the above

Question # 26

You hear from several counterparties that a major market participant has taken major losses on long USD/JPY positions. You know the reports are untrue, as you have in fact bought large amounts of USD/JPY from that very firm, which means that the impact of the reports on the market would be helpful to your position.

As you have heard the reports from other parties, you are entitled to pass them on to market news services.

As you have heard the reports from other parties, you are entitled to pass them on to other market participants.

You should not pass any information you know to be false.

You should contradict the reports.

Question # 27

In all dealing conversations, the Model Code strongly recommends:

Dealers stick to market terminology in order to avoid the impression that they are offering an advisory or fiduciary role.

Dealers clarity what is being proposed rather than using any terminology that could be misinterpreted.

Dealers restrict themselves to terminology listed and explained in Chapter 11 of the Model Code.

Dealers define complex terminology in the confirmation of a deal.

Question # 28

What is the risk of dealing through an agent with an unknown principal?

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.

You may not be able to net your exposure in an insolvency.

You may not be able to net your exposure for capital adequacy purposes.

All of the above.