ACI-Dealing Certificate (2) Set 11

1.

In foreign exchange markets, the first currency in a currency pair is:

The quoted currency The base currency The counter currency The terms currency

2.

Which of the following statements is an incorrect statement in respect of Model Code recommendations concerning electronic trading?

It is recommended that ECNs have mechanisms that control price flashing A manual kill button that disables the system's ability to trade and cancels all resting orders may not be established without Central Bank approval The sudden withdrawal of a specific credit limit or limits in a tactical manipulation to mislead the market is unethical Algorithms require appropriate supervision performed by staff with commensurate levels of experience

3.

What are financial market professionals not explicitly required by the Model Code to clarify and agree to in writing?

that the customer understands he will be charged for advisory services that are provided that the customer understands the terms, conditions and risks of the transaction that the customer understands that any information or explanation should not be interpreted as investment advice or recommendations that the customer understands he is entering into the transaction at his own risk and for his own account.

4.

When should confirmations be sent out?

one day after the deal is done within two hours of the trade being booked and as soon as technologically possible immediately after having received the confirmation of the counterparty no later than the value date of the first leg of the transaction

5.

In the unforeseen event that a particular maturity date is declared a public holiday, what is standard market practice for spot FX?

to extend the contract to the next business day to shorten the contract to the previous business day The two parties involved agree to a new maturity date. There is no standard market practice. ACIs Committee for Professionalism decides the issue on a case-by-case basis.

6.

What should a dealer say to express his commitment to putting an additional bid or offer at a current bid or offer price already quoted by his broker?

same way" me too" "par", or "parity" "join at", or "support at"

7.

If making a claim in respect of "use of funds", payments should be settled within how many days?

15 20 35 40

8.

Which of following terms is not used as an expression for dates other than regular dates/periods?

cock dates broken dates odd dates weird dates

9.

Which of the following statements with respect to trading and broking ethics through the use of technology is the correct quote from the Model Code?

Deliberate attempts at gaming and abuse using the flashing of orders without the intent to deal should be classified as proprietary trades. Management should ensure that the complete e-trading process, from pricing to risk impact through to settlement, conforms to recognized standards andmarket conventions. All bid-offers presented to electronic platforms should remain in the Matching System for no more than the minimum period of time defined within theirrespective Minimum Quote Life (MQL) rules. Trades which occur at off-market rates, by agreement between the two counterparts and as soon as practically possible, should stand and any profit beequitably divided between them.

10.

The Model Code is clear on "position parking". What does it say?

The parking of deals or positions with any counterparty is discouraged The parking of deals or positions with any counterparty should be forbidden The parking of deals or positions should be subject to a clear policy laid down in writing by senior management In jurisdictions where position parking is allowed, prior approval should be sought from the regulator

ACI-Dealing Certificate (2) Set 11

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ACI-Dealing Certificate (2) Set 11

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