some questions as follows: no#4, the second part says “the recent review for the client with the inheritance is a violation”. why cant we review the the client with changing condition as soon as we find it out? no #15, why include CTD conversion factor to calculate? doesnt the denominator represent the dollar duration of futures contracts? no #8, why with a short put? doesn’t a long put brings credit risk to the bank,causing it faced with the default risk of counterparty ?
where are these questions from ?
Don’t know other two questions. #15, without looking at the question. When you adjust the portfolio using future, you want to know the DD of the future contract, not the DD of CTD bond. DD of future= (DD of CTD bond)/(conversion factor)
soexcel, you must misread the #4. The answer is A, which includes the second part that recent review for the client with the inheritance has Not violated standards.
where are these sample questions from please?
got it. i’m wrong with #4. #15, i mean the denominator is already equal to (futures duration * futures value), so why include conversion factor additionally? this is the free-of-charge sample from CFAI website…