unit 2 extra exam qs Flashcards
Calculate terp for bonus issue
1:5 ratio
share price at 6
6x5=30
30/6=5
anomaly switching definition
- Exploiting mispricing in the bond market
policy switching
- Exploiting market shifts caused by, for example, interest rate movements
Client asks to split allotment letter for a right issue
buy at nil cost after selling rights for cash
custodian in trouble
ensure segregation of accounts
what is a merger
exchanging shares
authorised participant in an ETF
Only authorised participants (typically large institutional investors) actually
buy or sell shares of an ETF directly from/to the fund manager, and then
only in creation units – large blocks of tens of thousands of ETF shares –
which are usually exchanged in kind with baskets of the underlying
securities, this would be known as the primary market.
if not direct from fund manager and its large volume look for creation unit
min denomination for t bill
25K
Which CIS has a trustee
Unit trust
how to stop unsystematic risk
diversity eg holding multiple shares
what is a bond secured against a specific asset
Fixed
zero coupon preference shares definition
something about capital gain opportunity
listed company audited accounts
so listed companies
are generally required to provide audited annual accounts; and less detailed half-yearly, or perhaps
quarterly, reports.
exceptions inclue LSE which requires 6 monthly
A Japenese manufacturer wants to convert yen into dollars for a purchase in a few months, the current spot rate is $1:Yen 132.50, it will like to calculate the 3 month spot rate, what is this if the US interest rate is 3% pa and Japan’s is 1% pa
[ (1+(0.01 x 3/12)) / ((1+(0.03 x 3/12)) ] * 132.50
answer = 131.842
Who is the owner of ADR shares?
Depositary Bank
Which type of bond is monoline and provides a tax break?
Municipal bond
How long is the term on a medium term note, how long do their shelf registration last?
Term of 2-10 years, with a max shelf register of 2 years
What is the least risky corporate debt?
Commercial Paper
Habbeb plc is an LSE based company, what is the company’s account reporting obligation according to the listing authorities?
Annual reports
Habeeb plc is a NYSE Listed company that is dual listed on the LSE, assuming two different syndication teams are required per region, what would be the role of the UK team that leads the secondary issue
Co-Lead
Who provides wealth management services?
Stockbrokers
