310-010 by SUN Valid Free Exam Practice Test

Question 1

A large corporate client sends you a case of expensive wine as a reward for settling a compensation case in their favor. What should you do?

A. You should accept the gift without question as it was personally addressed to you. B. You should share the gift amongst your back office colleagues. C. You should decline the gift. D. You should report the gift to management and leave it to the management's discretion as to whether you are allowed to keep the gift.

Correct Answer: D

Question 2

What are the components of a FX swap?

A. two opposing spot trades B. an outright and a barrier option C. a cash trade with same-day settlement and a forward trade D. a spot trade and a forward trade

Correct Answer: D

Question 3

What is volatility?

A. the difference between the annual high and low of a security B. the measure of the liquidity of a contract or security C. a statistical measure of price fluctuations as an annualized percentage D. the difference between the current price of an asset and its previous close

Correct Answer: C

Question 4

Settlement prices on futures contracts are

A. official prices calculated by the exchange at the close of trading for the purpose of making margin calculations B. official prices calculated by the central bank where the stock exchange is located C. official prices calculated by a panel of central banks D. never used

Correct Answer: A

Question 5

If you apply a margin of 50 basis points to an interbank offered rate of 4 1/8%, what is the customer rate?

A. 4 5/8% B. 4.62% C. 4 3/8% D. 3 5/8%

Correct Answer: A

Question 6

Which interest rates are used to calculate the exchange rate of an outright transaction value tomorrow (over tom)?

A. the overnight interest rates of both currencies B. the spot next interest rates of both currencies C. the tom next interest rates of both currencies D. the one week interest rates of both currencies

Correct Answer: C

Question 7

What are the consequences for credit risk when a collateral agreement is added to a netting agreement?

A. A collateral agreement can reduce operational risk B. A collateral agreement eliminates the future replacement risk C. A collateral agreement can reduce market risk D. A collateral agreement can reduce the replacement risk

Correct Answer: D

Question 8

A bank responsible for making due payments of principal and interest on a bond is called the

A. purchase agent B. fiscal agent C. paying agent D. market maker

Correct Answer: C

Question 9

With respect to financial payments, what does "bridge" mean?

A. it refers to the relationship between two nostro account institutions B. it designates the exchange of payment orders between a nostro and a vostro account C. it refers to an electronic settlement between Euroclear and Clearstream D. it is an electronic settlement between US Clear and Clearcom

Correct Answer: C

Question 10

Open position and exchange risk management by currency belongs to which treasury system module?

A. the securities trading and processing module B. the FX spot and forward dealing input and processing module C. the derivatives dealing and processing module D. standard back office features

Correct Answer: B

Question 11

In the bond market, which of the following is true about the settlement amount?

A. The settlement amount is always calculated using the redemption price. B. On a coupon date, if the bond quotes at par, the settlement amount and the face value will be identical. C. The settlement amount is the sum of the redemption value plus all coupons paid by the issuer. D. If the yield and the coupon are exactly the same, the settlement amount and the face value will be identical.

Correct Answer: B

Question 12

For futures contracts quoted on an exchange:

A. the initial margin is a predetermined fraction of maintenance margin B. the maintenance margin is a predetermined fraction of initial margin C. the maintenance margin represents management fees D. the maintenance margin represents the brokerage costs

Correct Answer: B

Question 13

What is the inter-linking mechanism that connects the domestic real-time gross settlement (RTGS) payments systems in EU member states?

A. TARGET B. FX-NET C. CHAPS D. EAF

Correct Answer: A

Question 14

The effective Euro overnight reference rate, computed as a weighted average of all overnight unsecured lending transactions undertaken in the interbank market and computed with the help of the European Central Bank, is called:

A. SONIA B. EONIA C. EURONIA D. EURIBOR

Correct Answer: B

Question 15

Under what circumstances would you have to pay overdraft interest?

A. Overdraft interest is charged if your collateral at the central bank is lower than your cash balance B. if the counterparty's fees are higher than yours C. If your nostro account shows a debit balance you will be charged overdraft interest on the remaining debit amount. D. if your nostro account balance at the end of the month is less than the amount of fees paid

Correct Answer: C

SUN ACI - Operations Certificate - 310-010 Exam Practice Test