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3I0-010 - ACI - Operations Certificate - Dump Information

Vendor : ACI
Exam Code : 3I0-010
Exam Name : ACI - Operations Certificate
Questions and Answers : 342 Q & A
Updated On : Click to Check Update
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3I0-010 Questions and Answers

Pass4sure 3I0-010 Dumps with Real Questions & Practice Test


Answer: D


QUESTION: 325

A European-style option is:


  1. an option traded in EUR

  2. an option which can be exercised at any time between the purchase and expiration date

  3. an option with premium payable only on its expiry date

  4. an option which can be exercised only at maturity


Answer: D


QUESTION: 326

What is the "spread" in an interest rate swap (IRS)?


  1. the interest rate differential between the fixed and floating leg of the swap

  2. the brokerage fee for an interest rate swap transaction

  3. the payment made when a swap is terminated

  4. the difference between the swap rate and the benchmark government yield


Answer: D


QUESTION: 327

The writer of an options contract:


  1. bears a risk limited to the premium paid

  2. bears a substantial risk

  3. bears a risk limited to the premium received

  4. bears no risk


Answer: B


QUESTION: 328

Settlement prices on futures contracts are


  1. official prices calculated by the exchange at the close of trading for the purpose of making margin calculations

  2. official prices calculated by a panel of central banks

  3. official prices calculated by the central bank where the stock exchange is located

  4. never used


Answer: A


QUESTION: 329

How could you close out a futures contract?


  1. reverse and cash trade

  2. cash and carry

  3. reverse cash and carry

  4. offset


Answer: D


QUESTION: 330

In hedging, caps are


  1. frequently purchased by issuers of floating rate debt

  2. frequently sold by issuers of floating rate debt

  3. frequently sold by issuers having an FX risk

  4. frequently purchased by issuers having an FX risk


Answer: A


QUESTION: 331

Which of these statements is correct?


  1. The strike price of a Bermudan option is an average.

  2. A Bermudan option can be exercised only on a few specific dates prior to expiration.


  3. A Bermudan option can be exercised at any time before its maturity date.

  4. A Bermudan option can be exercised only at maturity.


Answer: B


QUESTION: 332

You are an issuer of a straight bond and you want to change your exposure from a fixed rate

to a floating rate because you expect a fall in interest rates. What would you do?


  1. Buy an IRS

  2. Sell an IRS

  3. Buy a FRA

  4. Do nothing because the bond coupon is already a fixed rate


Answer: B


QUESTION: 333

Generally, "initial margin" means:


  1. the notional amount of a contract

  2. a deposit amount per contract that is determined by the futures exchange

  3. the maximum net loss during the contract period

  4. the minimum net loss during the contract period


Answer: B


QUESTION: 334

For futures contracts quoted on an exchange:


  1. the maintenance margin is a predetermined fraction of initial margin

  2. the initial margin is a predetermined fraction of maintenance margin

  3. the maintenance margin represents the brokerage costs

  4. the maintenance margin represents management fees


Answer: A


QUESTION: 335

In using futures contracts there is:


  1. only market risk

  2. only credit risk

  3. market risk and credit risk

  4. market risk, credit risk and delivery risk


Answer: A


QUESTION: 336

Your bank purchases a FRA at 5.75% in USD. Under what conditions will you pay a cash settlement?


  1. if EURIBOR is higher than 5.75%

  2. if EURIBOR is lower than 5.75%

  3. if LIBOR is lower than 5.75%

  4. if LIBOR is higher than 5.75%


Answer: C


QUESTION: 337

A trader purchases a six month over-the-counter straddle (options strategy) for a 1 million premium from a counterparty. The maximum credit exposure over the life of the trade is:


  1. less than 1 million

  2. there is no credit exposure

  3. exactly 1 million

  4. none of the above


Answer: D


QUESTION: 338

Your dealer has sold a 3x6 USD 10,000,000.00 FRA at 5.55%. On settlement day the 3- month (90-day) fixing is 5.45%. What would you do?


  1. pay USD 2,466.40

  2. receive USD 2,465.79

  3. pay USD 2,465.79

  4. receive USD 2,466.40


Answer: D


QUESTION: 339

An American-style option is:


  1. an option traded in USD

  2. an option which can be exercised at any time between the purchase and expiration date

  3. an option based on any US dollar instrument

  4. an option which can be exercised only at maturity


Answer: B


QUESTION: 340

What financial product involves exchanging a fixed interest rate for a floating interest rate?


  1. a FX swap

  2. a repurchase agreement

  3. an interest rate swap

  4. a dual swaption


Answer: C


QUESTION: 341

Which of the following statements best describes an asset swap?


  1. a combination of a fixed rate bond and a fixed/floating interest rate swap

  2. an option on fixed/floating interest rate swap

  3. the sale of a bond against cash with a simultaneous agreement to buy the bond at an

    agreed upon rate and date

  4. the sale of a fixed rate bond against the simultaneous purchase of a floating rate note


Answer: A


QUESTION: 342

When is the settlement amount of a FRA normally payable?


  1. at the beginning of the forward period

  2. on the trade date

  3. on the maturity (final) date

  4. at any time before the contract's maturity date


Answer: A


ACI 3I0-010 Exam (ACI - Operations Certificate) Detailed Information

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