Free CFA-Level-I Exam Braindumps (page: 543)

Page 543 of 991

A Treasury bond dealer observes the following Treasury spot rates from the spot rate curve: 1-year 7.40%, 2- year 7.00%, and 3-year 6.3%. The bond dealer also observes that the market price of a 3-year 8% coupon, 100 par value bond is $103.95. Based on this information, the dealer should:

  1. buy the 8% coupon bond in the open market, strip it, and sell the pieces.
  2. sell the 8% coupon bond short, and buy the component cash flow strips with the proceeds.
  3. do nothing since the 8% bond is selling for its arbitrage-free price.

Answer(s): A



David Garcia, CFA, is analyzing two bonds. Bond X is an option tree corporate security with a 7% annual coupon and ten years to maturity. Bond Y is a mortgage backed security that also matures in ten years. Garcia is considering two possible interest rate scenarios--one in which rates are flat over the entire 10-year horizon, and one in which the yield curve is sloped steeply upwards. For each bond, Garcia has calculated the nominal spread over the 10-year U.S. Treasury issue as well as the zero-volatility spread. The zero-volatility spread would differ the most from the nominal spread:

  1. for Bond X, when the yield curve is sloped steeply upwards
  2. for Bond Y, when the yield curve is sloped steeply upwards
  3. for Bond X, when the yield curve is flat

Answer(s): B



The bonds of Joslin Corp. are currently callable at par value. The bonds mature in eight years and have a coupon of 8%. The yield on the Joslin bonds is 175 basis points over 8-year U.S. Treasury securities, and the Treasury spot yield curve has a normal, rising shape. As yields on bonds comparable to the Joslin bonds decrease, the Joslin bonds will most likely exhibit:

  1. negative convexity
  2. increasing modified duration
  3. increasing effective duration

Answer(s): A



Donald McKay, CFA, is analyzing a client's fixed income portfolio. As of the end of the last quarter, the portfolio had a market value of $7,545,000 and a portfolio duration of 6.24. McKay is predicting that the yield for ali of the securities in the portfolio will decline by 25 basis points next quarter. Which of the following statements regarding the portfolio's performance next quarter is most accurate?

  1. For the expected change in portfolio yield next quarter, the market value of the portfolio will change by approximately 6.24%.
  2. If the yield curve has a 50 basis point downward parallel shift next quarter, the portfolio will increase in value by approximately $235,404.
  3. The portfolio's ending value after the expected decline in yields will be approximately $7,427,298.

Answer(s): B



Page 543 of 991



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Mostly challenging question
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Moana commented on October 04, 2024
Preperation
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Dominic commented on October 04, 2024
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Miss Tech commented on October 04, 2024
@Lucas, hi did you pass?and how many questions were in the Exam because l can only see 47Q here on the dumps,???
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Vani commented on October 04, 2024
Very useful
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Priyanka Prasad commented on October 04, 2024
i need questions
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Jack commented on October 03, 2024
are these still legit?
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Ashok Kumar commented on October 03, 2024
Very good content to prep
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By far one of the best free sources of exam dumps. I searched google for free braindumps and boom I got this right away.
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I'm writing next week, are the questions still valid?
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Rama commented on October 03, 2024
All looks good.
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Yaron M commented on October 03, 2024
please stop the pain i cant take this anyomre my wife left me and she took the kids its been 54 years and i still cant pass AZ104 please make the suffering stop
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Varon commented on October 03, 2024
The 2 hardest topics of this exams are: 1) Designing Resilient Architectures and 2) Cost-Optimized Architectures By mastering these areas, you’ll be better prepared for tricky exam questions related to resilient and cost-effective architectures.
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Haji Momen commented on October 03, 2024
The questions in the exam dumps are pretty same as the real exam the only problem is that it is not complete or has less questions compared to full version. I am from South Africa and this is expensive for me. So I will be using the free version.
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Saurabh commented on October 03, 2024
Super Course to go ahead
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just reviewing
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DJ commented on October 03, 2024
This dump is still valid?
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Rk commented on October 03, 2024
Good content
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George commented on October 02, 2024
Focus on mastering designing scalable, resilient architectures and cost-optimization strategies using core AWS services for this SAA-C03 exam.
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Esmaiel commented on October 02, 2024
This is a very good practice paper to get ready for exam. Helpful to me.
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Fawad commented on October 02, 2024
The exam turned out to be very hard as stated by some users here. So there is no way to pass it unless you know the questions. And note that some of the answers in this exam dump PDF is not correct but the questions are legit.
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Moataz commented on October 02, 2024
I approve this exam dump. It is valid in UAE. I passed the test.
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