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ACI 3I0-012 - ACI Dealing Certificate

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Total 740 questions

How can options be used to synthesize a short position in the underlying commodity?

A.

A short put option + long call option at the same strike price

B.

A long put option + short call option at the same strike price

C.

A short put option + short call option at the same strike price

D.

A long put option + long call option at the same strike price

You are paying 5% per annum paid semi-annually and receiving 6-month LIBOR on a USD 10 million interest rate swap with exactly two years to maturity . 6-month LIBOR for the next payment date is fixed today at 4.95%. You expect 6-month LIBOR in 6 months to fix at 5.25%, in 12 months at 5.35% and in 18 months at 5.40%. What do you expect the net settlement amounts to be over the next 2 years? Assume 30-day months.

A.

pay 250, receive 1,250, receive 1,750, receive 2,000

B.

receive 250, pay 1,250, pay 1,750, pay 2,000

C.

pay 2,500, receive 12,500, receive 17,500, receive 20,000

D.

receive 2,500, pay 12,500, pay 17,500, pay 20,000

Which of the following cannot produce a capital gain?

A.

Treasury bill

B.

CD

C.

ECP

D.

Classic repo

Payment and settlement instructions should be passed:

A.

As quickly as possible.

B.

Within 24 hours of the transaction.

C.

Setore 10:00 am on the value date.

D.

Betore close of business on the transaction date.

Which position below is NOT a component of common equity Tier 1 capital?

A.

innovative hybrid capital instruments with incentives to redeem

B.

common shares issued by bank

C.

retained earnings

D.

stock surplus (share premium)

You quote a price to a broker on EUR 100 million. Your price is hit for EUR 50 million. What does the Model Code say about this situation?

A.

You have a right to qualify your quotes in terms of amounts, if you do so when you make the price.

B.

You have a right to qualify your quotes in terms of amounts, provided the amounts are marketable.

C.

You have a right to qualify your quotes in terms of amounts, once you have discovered the name of the counterparty for credit reasons.

D.

You have a right to qualify your quotes in terms of amounts.

What is a Vostro account?

A.

Your account at another bank

B.

A foreign bank’s account in your bank in your domestic currency

C.

An account in your bank used for internal transactions

D.

A customer’s account at your bank

What rate should be used if the settlement date in a foreign exchange transaction is no longer a “good” date?

A.

The original rate of the transaction

B.

The original rate of the transaction adjusted by the relevant forward points

C.

The affected parties should agree to adjust the exchange rate according to the prevailing relevant forward mid swap points at the time the bank holiday is announced

D.

The rate is open to negotiation by the two parties

The torward points are calculated from:

A.

The level of interest rates in the base currency

B.

The level of interest rates in the quoted currency

C.

The interest rates in the two currencies

D.

Your expectations of the future spot rate

You have just sold USD 5,000,000.00 spot against JPY. What type of risk does not apply?

A.

Market risk

B.

Settlement risk

C.

Basis risk

D.

Credit risk

Name switching is:

A.

the practice of a dealer attempting to replace one customer by a new one in a previously dealt transaction

B.

the practice of a broker having to show a new name to the dealer, although he was full on the first name presented to him

C.

the practice of a broker attempting to substitute a third name between the two original counterparties to clear the transaction

D.

the practice of a broker attempting to show a substitution name to get out of a situation in which he was stuffed by a dealer

Your are quoted the following rates:

spot CHF/JPY 60.12-22

3M CHF/JPY 25.5/22.5

At what rate can you buy 3-month outright JPY against CHF?

A.

79.995

B.

79.965

C.

79.895

D.

79.865

You are quoting forward FX prices to a broker subject to finding a counterparly for a matching transaction. The Model Code says:

A.

You must tell the broker, who must qualify your quotes.

B.

For credit reasons, you must tell the broker when he presents a name.

C.

You cannot do this.

D.

The Model Code does not make recommendations on this subject.

What is the minimum basis on which a BCP should be updated and tested?

A.

Every 6 months

B.

Yearly

C.

Whenever the BCP procedures are changed

D.

Every 3 months

A forward-forward loan creates an exposure to the risk of:

A.

Higher interest rates

B.

Lower interest rates

C.

Steepening yield curve

D.

Parallel shift downwards in the yield curve