Sample exam questions Flashcards
What type of derivative is usually used to achieve synthetic replication in an ETF?
Swaps
What price are gilts usually traded and settled at?
Traded - clean
Settled - dirty
In what form do governments tend to issue their short-term (i.e. less than six months) bonds?
As zero coupon bonds
Which is likely to have a higher yield, a puttable bond or a conventional bond?
Conventional
What is the indexation lag for index-linked gilts?
Issued pre-July 2005 - 8 months
Issued post-July 2005 - 3 months
What is the acid test ratio also known as?
Liquidity ratio
What type of share involves a share certificate without the shareholder’s name?
Bearer shares
What type of share will only pay a dividend after all other dividends have been paid?
Deferred shares
What’s the main difference between warrants and call options?
Warrants are generally issued for longer time periods.
Does a warrant provide an investor with the right or obligation to buy shares at a set price in the future?
Right to buy
Between what hours does automatic execution take place on the Stock Exchange Electronic Trading System?
8am-4:30pm
What type of price transparency rules apply to dark pools?
Post-trade only
What is a dual-listed company?
A company that’s listed on two separate stock exchanges, but as two separate entities operating under a group structure
What system establishes that the legal title to a share has changed?
Operator Register
If a trade is executed between 7:15am and 8pm, when is the latest time it can be reported?
8:03am
