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ACI 3I0-012 - ACI Dealing Certificate

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Total 740 questions

You have prepared the following economic capital table for the next ALCO meeting:

For which of the following risks should you consider actions?

A.

credit risk

B.

interest rate risk

C.

liquidity risk

D.

currency risk

What should be done when a voice broker calls “off” at the very instant the dealer hits the broker’s price as “mine” or “yours”?

A.

The transaction should be concluded and the broker should inform both counterparties accordingly.

B.

The dealer who hits the broker’s price may decide whether the deal is done or not; the broker should inform both counterparties accordingly.

C.

The deal should not be concluded and the broker should inform both counterparties accordingly.

D.

The broker should immediately inform both counterparties that the deal will have to berenegotiated.

Extended trading hours and off-premises dealing can involve additional hazards, the avoidance of which requires clear controls. The Model Code prescribes best market practice. Which of thefollowing is true?

A.

Off-premises dealing should be strictly prohibited.

B.

After-hours trading should be prohibited.

C.

Deals transacted after normal business hours or off-premises should only be undertaken on mobile phones approved by management.

D.

Deals transacted after normal business hours or off-premises either by mobile phones or any other equipment should only be undertaken with the approval of management.

The delta of an ‘at-the-money’ long put option is:

A.

Between -0.5 and -1

B.

-0.5

C.

Between +0.5 and +1

D.

+0.5

If spot USD/HKD is 7.7600 and USD/SGD is 1.2350, what is SGD/HKD?

A.

9.5836

B.

6.2834

C.

0.1591

D.

0.1043

A bank quotes 3-month EUR deposits at 0.45% ¡ª 0.55% to its broker. The broker lifts the bank’s offer at 0.55%. Which of the following steps must the broker take?

A.

The broker must show the borrower’s name to the lender first and disclose the lender’s name only if the borrower is acceptable to the lender.

B.

The broker must show the lender’s name to the borrower first and disclose the borrower’s name only if the lender is acceptable to the borrower.

C.

The broker must show the borrower’s and lender’s names to each other at the same time.

D.

For marketing reasons, the broker can show the lender’s name to the borrower at any time.

Which of the following is part of the typical scope of Asset Liability Management (ALM)?

A.

Selling distressed assets and investing in bank liabilities trading at distressed levels.

B.

Making sure that fixed assets are depreciated according to the applicable tax code.

C.

Planning the maturity structure and net funding requirements arising from banking book and trading book transactions.

D.

Planning the liability structure and net funding requirements arising from trading book assets carried at amortized cost.

If you have created a ‘synthetic asset’ by buying and selling a USD/CHF swap, what have you done?

A.

Created an exposure to the CHF

B.

Created an exposure to the USD

C.

Switched a CI-IF asset temporarily into USD without taking currency risk

D.

Switched a USD asset temporarily into CHF without taking currency risk

The primary issue for insuring prudent liquidity management in accord with the guidance provided by the Basel Committee (Basel II I Basel III) is:

A.

Tier 3 capital requirements held against liquidity risk.

B.

The nature and amount of high quality liquid assets a bank holds.

C.

Central bank internal management processes regarding open market operations.

D.

The transparent disclosure of illiquid on-balance sheet liabilities.

The major difference between FRAs and futures is that FRAs are:

A.

Exchange-traded

B.

Margined

C.

Standardized

D.

Dealtoverthe counter

The intrinsic value of a long call option:

A.

Falls and rises with the price of the underlying commodity, but is always positive

B.

Rises if the price of the underlying commodity falls and vice versa

C.

Depends solely on the volatility of the price of the underlying commodity

D.

Becomes negative if the market price of the underlying commodity falls below the strike price of the option

Where the matter of dealing for personal account is concerned, the Model Code recommends that

A.

Subject to local legal requirements, this matter is one for bank management to decide.

B.

Bank management should encourage such activities because it allows banks to monitor the gambling habits of their staff.

C.

Where this is allowed, bank management should have a clearly defined policy and written procedures.

D.

Bank management should allow staff to deal for their personal account on a case to case basis.

How much is a big figure worth per million of base currency it EUR/GBP is 0.6990?

A.

GBP 10,000

B.

EUR 10,000

C.

GBP 6,990

D.

EUR 6,990

You are quoted the following rates:

Spot JPY/CHF 0.009520-25

6M JPY/CHF 10/7

At what rate can you buy 6-month outright CHF against JPY?

A.

0.008520

B.

0.009510

C.

0.009515

D.

0.009518

In case of a default on a repo by the seller:

A.

The buyer can liquidate the collateral

B.

The buyer has to liquidate the collateral

C.

The buyer cannot liquidate the collateral until the seller is declared insolvent

D.

A court is appointed to decide what happens to the collateral