Test Questions Flashcards
The accrual convention for gilts is
Actual/actual
The London FOREX market is
An order driven market
The long run Phillips curve is vertical at which level of unemployment
Natural
A contract for difference is best defined as an agreement between two parties to exchange the difference between:
The opening and closing price of the contract
A certificate of deposit
Is a tradeable time deposit
Which of the following statement an about an OEIC are correct
There is a single price for buying and selling shares in the company
The assets of the company are looked after by a depository
If a CDO (collateralized debt obligation) is made up of credit derivatives, what is it called
A synthetic CDO
In the UK, covered warrants are traded
On the London Stock Exchange
Tactical asset allocation refers to
Short term departures from strategic portfolio weights
A convertible bond will usually have a price which is
At least as great as the price of an equivalent non- convertible issue
Who issues gilts
The debt management office
What is pure expectation theory
The shape of the yield curve can be explained in terms of expected future interest rates
Commercial paper has the following characteristics
Maturity varies from seven days to one year
Who regulates collective investment schemes
Financial conduct authority
What is the maximum proportion of an investment trust company’s (ITCs) funds that can be invested in a single company
15%
Who is responsible for the safe keeping of assets for an open ended investment company (OEIC)
Depository Institution
The option sensitivity ‘theta’ represents the movement of the option value as which of the following charges
Time to expiration
What best describes a bullet portfolio
Where bonds are selected with duration close to the liabilities duration
A budget deficit is also known as
A positive public sector net cash requirement (PSNCR)
Which of the following are included in M0
Notes coins in circulation, banks till money and banks balances at the BoE
What best describes R2
The amount of variation explained by the regression line
The accounting equation is best defined as which of the following?
Shareholders fund + current liabilities - non-current assets = current assets - non-current liabilities
If goodwill is believed to have a limited life, how should this be reflected in the accounts
Annual impairment review
The Financial Times Ordinary Share Index (FT30 - Share Index) is calculated using which calculation approach
Equally weighted geometric index
Which of the following indices is an unweighted arithmetic index?
Nikkei 225
I’m a product life cycle, profits are maximized during
The growth phase
Accounting standards in the UK are issued by?
Financial Reporting Council
Which of the following methods of issuing shares allows the public to purchase them?
Offer for sale
The most direct way to invest in commodities is by using
Futures contracts
An investor who owns commodity futures will earn a positive roll yield if
The market is in backwardation
The hedonic method of valuing a property investment is an aspect of which broad valuation approach?
The sales comparison approach
