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ACI 3I0-012 - ACI Dealing Certificate

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Total 740 questions

What is the ISO code for silver?

A.

XAU

B.

XAG

C.

XPT

D.

XPD

In the international market, a FRA in USD is usually settled with reference to:

A.

BBA LIBOR

B.

Fed funds

C.

ISDALIBOR

D.

EURIBOR

What is a short strangle option strategy?

A.

A short call option + long put option with a higher strike price than the call option

B.

A long call option + long put option with a lower strike price than the call option

C.

A short call option + short put option with a lower strike price than the call option

D.

A long call option + long put option with higher strike price than the call option

What is the probability of an ‘at-the-money’ option being exercised?

A.

Less than 50% probability

B.

50% probability

C.

More than 50% probability

D.

Zero probability

Repo is said to have “double indemnity” due to the creditworthiness of the counterparty and:

A.

A written legal agreement between the parties

B.

The oversight of the transaction by the custodian of the collateral

C.

The creditworthiness of the collateral

D.

The right of close-out and set-off in an event of default

Which one of the following is a major objective of ACI-The Financial Markets Association?

A.

to promote globalization and deregulation of the financial markets

B.

to maintain the professional level of competence and to disseminate a high level of ethical and professional behavior

C.

to act as the official international market regulator in the absence of government regulation

D.

to become the sole global corporation of wholesale financial market professionals

The two-week repo rate for the 5.25% Bund 2014 is quoted to you at 3.33-38%. You agree to reverse in bonds worth EUR 266,125,000.00 with no initial margin.

You would earn repo interest of:

A.

EUR 349,806

B.

EUR 344,632

C.

EUR 319,315

D.

EUR 324,110

You are paying 5% per annum paid semi-annually and receiving 6-month LIBOR on a USD 10,000,000.00 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 250.00, receive 1,250.00, receive 1,750.00, receive 2,000.00

B.

Receive 250.00, pay 1,250.00, pay 1,750.00, pay 2,000.00

C.

Pay 2,500.00, receive 12,500.00, receive 17,500.00, receive 20,000.00

D.

Receive 2,500.00, pay 12,500.00, pay 17,500.00, pay 20,000.00

The Liquidity Coverage Ratio (LCR) in Basel III:

A.

is a new rule that compares liquid asset levels in banks to their available equity capital

B.

spells out a modernized system for calculating the required minimum reserve that banks must hold at the central bank

C.

compares liquid and reliably liquidating assets to expected cash outflows from specified run-off rates for various liability classes under a short-term stress scenario

D.

tied directly into the internal ratings-based approach for determining the liquidity of credit-counterparties

Which of the following correctly states the Model Code’s recommendations regarding electronic trading and broking?

A.

Liquidity providers should be cognizant of reputational risks when supplying liquidity for onward third party consumption.

B.

Market participants must not seek information as to the legal status of a potential counterparty before allocating credit or trading status.

C.

Transactions should be handled in accordance with the regulator’s dealing rule book.

D.

Access to systems internally and at the client interface must be strictly controlled by the dealers.

You are quoted the following market rates:

Spot EUR/USD 1.3150

3M (92-day) EUR 0.20%

3M (92-day) USD 0.44%

What is 3-month EUR/USD?

A.

1.3159

B.

1.3158

C.

1.3142

D.

1.3230

What is a short straddle option strategy?

A.

A long call option + long put option with the same strike prices

B.

A short call option + short put option with the same strike prices

C.

A long call option + short put option with the same strike prices

D.

A short call option + long put option with the same strike prices

Under Basel Rules, the Basic Indicator Approach is a regulatory framework for:

A.

liquidity risk

B.

business risk

C.

operational risk

D.

funding risk

You are quoted spot USD/NOK 5.7220-28 and USD/SEK 6.3850-58, at what price can you buy NOK against SEK?

A.

0.8963

B.

1.1157

C.

1.1159

D.

1.1160

When considering interest rate risk in the banking book, retail demand deposits without fixed contractual maturity:

A.

should be assumed to have zero duration

B.

should be treated like other instantly variable rate liabilities, such as overnight money market borrowing.

C.

should be assumed to have a low correlation with money market reference rates

D.

represent a minor contributor to interest rate risk and can safely be disregarded