1.

The directions issued under section 45W of the Reserve Bank of India Act, 1934 are titled Currency Futures (Reserve Bank) Directions, 2008 came into force w.e.f. 6th ________ August, 2008. September, 2008 October, 2008 November, 2008 2. Value Tom (Tomorrow)= Trade Date + 1 i.e ____ business day after deal date 1 2 3 4 3. Long Hedger will Long currency futures Short Currency Futures Both of the Above None of the Above 4. An Investor is holding Gold worth Rs. 10,20,000/-. The USD/INR is 48.2525. How many Lots of USD/INR will give him a proper Hedge 2113 30 100 21 5. In foreign exchange markets, the ______ currency is the first currency in a currency pair. Term Base Basis Fix 6. The __________ is the only currency of a major European country that belongs neither to the European Monetary Union nor to the G-7 countries Japanese Yen US Dollar GBP Swiss Franc 7. An Indian Investor was highly bullish on S&P 500 so he buys S&P500 worth $1,00,000/-.USD/INR was Rs.40/- After one year the S&P500 went high giving him a profit of $10,000/-. The USD/INR is Rs.44/- What is his profit on Portfolio and USD/INR

10%, 0% 0%, 10% 10%, 10% 10%, .1% 8. Banks authorized by the Reserve Bank of India under section 10 of the Foreign Exchange Management Act, 1999 as AD Category - I bank are permitted to become trading and clearing members of the currency futures segment of the recognized stock exchanges, on their own account and on behalf of their clients, subject to fulfilling the following minimum prudential requirements: Minimum net worth of Rs. 500 crores. Minimum CRAR of 10 per cent. Net NPA should not exceed 3 per cent & Made net profit for last 3 years All of the Above 9. A TM's open position is arrived at as the summation of his proprietary open position and ______' open positions, in the contracts in which he has traded. Clients Proprietary Clearing members None of the above 10. Proprietary positions are calculated on _____ (buy - sell) for each contract Gross basis Total Basis Net basis Settlement basis 1. Foreign exchange spot trading is buying one currency with a different currency for _______ delivery Forward Future Immediate None of the Above 2. Long Hedger will be Short in the foreign currency Long in the foreign currency Both of the Above None of the Above 3. A recognized stock exchange having nationwide terminals or a new exchange recognized by SEBI may set up currency futures segment after obtaining SEBIs approval

TRUE FALSE Both of the Above None of the Above 4. Value of OP = Underlying position + Hedging position; and in case of a Perfect hedge, the Value of the OP is insensitive to exchange rate (FX) changes. True False Both of Above None of Above 5. Long hedge means Underlying position of short in the foreign currency and Hedging position of long in currency futures True False Both of Above None of Above 6. The proper size of the Hedging position in Basic Approach is Equal hedge Optimal hedge Partial Hedge None of the Above 7. The exposure of the banks, on their own account, in the currency futures market shall form part of their _________________ limits. Net Open Position (NOP) Aggregate Gap (AG) Both of the Above None of the Above 8. If an order to buy/sell is limited by fixed price it is called Limit Order Limited Discretionary Order Stop loss Order Best Rate Order 9. In which of the following types of orders the client does not give any price or time limit for execution of order? Limit Order Limited Discretionary Order Stop loss Order Market Rate Order

10. The standard settlement convention for Foreign Exchange Spot trades is T+2 days T+3 days T+1 days T+4 days 1. Short Hedger will be Short in the foreign currency Long in the foreign currency Both of the Above None of the Above 2. Value ________= Trade Date + 1 i.e one business day after deal date Spot Forward Future Tom (Tomorrow) 3. The recognized stock exchange should have a balance sheet networth of at least Rs. ______ crores. 50 100 150 200 4. The Exchange should have at least ________ members to start currency derivatives trading 10 25 40 50

5. Short hedge means Underlying position of short in the foreign currency and Hedging position of long in currency futures True

False Both of Above None of Above 6. The proper size of the Hedging position in Modern Approach is Equal hedge Optimal hedge Partial Hedge None of the Above 7. Whenever the base currency buys more of the terms currency, the terms currency has weakened / depreciated True False Both of Above None of Above 8. Whenever the base currency buys more of the terms currency, the terms currency has ____________ Weakened Depreciated Both of the above None of the Above 9. The largest and the most liquid financial market in the world is the ___________. Equity market Foreign Exchange market Bond market None of the above 10. All futures contracts for each member are marked-to-market(MTM) to the daily settlement price of the relevant futures contract at the end of each day. The profits/losses are computed as the difference between The trade price and the day's settlement price for contracts executed during the day but not squared up The previous day's settlement pric e and the current day's settlement price for brought forward contracts The buy price and the sell price for contracts executed during the day and squared up. All of the above

1. Maximum age for admission as a Trading Member of Currency Futures Derivatives Segment is 21 years 18 years 25 years 60 Years 2. An applicant must be in a position to pay the membership and other fees, deposits etc, as applicable at the time of admission within three months of intimation to him of admission as a Trading Member or as per the time schedule specified by the Exchange TRUE FALSE Both of the Above None of the Above 3. At present, __________ are not permitted to participate in currency futures market. FII NRI Both of the Above None of the Above 4. _______________ has issued guidance notes on accounting of index futures contracts from the view point of parties who enter into such futures contracts as buyers or sellers ICFAI ICWA FPSB ICAI 5. An intercurrency pair spread is a long-short position in futures on different underlying currency pairs. Both typically have the same maturity. True False Both of Above None of Above

6. Margins are paid on a ______ basis T +1 Upfront T +2 T +3 7. Final Settlement rate would be the Reserve Bank (RBI) Reference rate for the date of expiry. True False Both of Above None of Above 8. Whenever the base currency buys more of the terms currency, the base currency has __________. Appreciated Depreciated Volatile None of the above 9. A Buy order in a Stop Loss book gets triggered when the last traded price in the Normal Market. Reaches or falls below the Trigger price Reaches or exceeds the Trigger price Gets immediate Triggered what ever is the rate There is no such Stop Loss Order 10. Complaints with Trading Member are filed with the Trading Member False True 1. _________ means the month in which the exchange/clearing corporation rules require a contract to be finally settled. Exercise Forward Contract month None of the Above

2. In foreign exchange markets, the base currency is the _____ currency in a currency pair. First Second Third Fourth 3. A foreign exchange swap is NOT a simultaneous purchase and sale, or sale and purchase, of identical amounts of one currency for another with two different value dates. True False Both of Above None of Above 4. Liquidity in one currency is converted into another currency for a period of time. True False Both of Above None of Above 5. Final settlement will be cash settled on ______- basis. T +1 T +2 T +3 T +4 6. An Basic hedge is one where the changes in the spot prices are negatively correlated with the changes in the futures prices and perfectly offset each other. True False Both of Above None of Above 7. At Client Level the gross open position of the client across all contracts should not exceed _____ of the total open interest or USD 10 million whichever is higher. 4%

5% 6% 7.5% 8. Hedging essentially helps transfer of _______. Funds Goods Risks None of the above 9. DQ (Disclose Quantity) Order is a type of Time Condition Quantity Condition Price Condition No Condition 10. An Arbitrager Buys 5 lots of USD/INR January Futures @44.5000 and sells March Futures @45.8500. After 25 days he squares up March position @43.3000 and January Futures at 42.8000. Find out the Arbitrage Profit / Loss ? +4250 -4520 +4520 -4250 1. First major currency is _________ Australian Dollar Euro GBP US Dollars 2. The Swiss Franc is the only currency of a major European country that belongs neither to the European Monetary Union nor to the G-7 countries False True Never true Always false

3. A futures contract is a standardized contract True False Both of Above None of Above 4. When the underlying is an exchange rate, the contract is termed a Commodities futures contract. Equities futures contract. Currency futures contract. Index futures contract. 5. The Exchange will disseminate alerts whenever the gross open position of the client exceeds _______ of the total open interest at the end of the previous days trade. 3% 5% 6% 7.5% 6. In the Currency Derivatives segment, trading-cum-clearing member, clear and settle their own trades as well as trades of other trading members (TMs). True False Both of Above None of Above 7. A buy position '20000@ 40.0000"means ______ contracts bought at the rate of Rs. 40.0000 2 20 200 2000

8. Futures markets are designed to solve the problems that exist in the ____________.

spot markets forward markets options markets None of the above 9. A GTC order is a ___________ condition order Price Quantity Time No Condition 10. The amount that must be deposited in the margin account at the time a futures contract is first entered into is known as Cost of Carry Initial Margin MTM Basis

1. A Forwad contract is a customised contract True False Both of Above None of Above 2. Internationally, currency futures can be cash settled or settled by delivering the respective obligation of the seller and buyer. True False Both of Above None of Above 3. Currency futures are a _________ product Linear Non-Linear Both of the above None of the Above

4. In the case of the USD-INR currency futures contract the tick size shall be 0.25 paise or 0.0025 Rupee. True False Both of Above None of Above 5. All open positions will be multiplied by _____(contract size in USD) to arrive at the open position in USD terms 10 100 1000 10000 6. The final settlement price is the RBI reference rate for the last trading day of the futures contract. True False Both of Above None of Above 7. The open positions of the members are marked to market based on contract settlement price for each contract. The difference is settled in cash on a T+1 basis True False Both of Above None of Above 8. CME FX Futures are traded by _________________. commercial banks investment banks hedge funds All of the above 9. A dealer can view and perform order and trade related activities only for ________ Trading Member Himself Exchange Branch

10. When any order enters the trading system, it is a/an _____ order Active Passive Useless Best

1. In India, currency futures can be cash settled or settled by delivering the respective obligation of the seller and buyer. True False Both of Above None of Above 2. Rs.42.2500. One tick move on this contract will translate to _______ or _______ depending on the direction of market movement. Rs.42.2475 Rs.42.2525 Both of the Above None of the Above 3. In the case of USD/INR, spot value is T+1 T+2 T+3 T+4 4. The currency futures contracts on the SEBI recognized exchanges have one-month, two-month, and three-month up to twelve-month expiry cycles. Hence, these exchanges will have 12 contracts outstanding at any given point in time. True False Both of Above None of Above

5. On 15th April Mr.Anil bought a April USDINR futures contract which cost him Rs.44000. Each USDINR futures contract is for delivery of USD1000. The RBI reference rate for final settlement was fixed as 44.10. How much profit/loss did he make? Profit 6000 Loss 300 Loss 4500 Profit 100

6. Who sets limit for Trading member Corporate manager Clearing Member SEBI RBI

7. Clearing Member sets limits for ________ Corporate manager Trading Member SEBI RBI

8. Clients have to pay _______ types of Margin 1 2 3 4

9. ASK or OFFER is Buyers price Sellers Price Auction price Future price

10. Each order has a distinctive order number and a unique __________ on it. ID Time stamp Vaule time 1. The _______ business day would be taken for Final Settlement date of each contract for Inter-bank Settlements in Mumbai. Last Thursday Last First day Either of the above 2. The last business day would be taken for Final Settlement date of each contract for Inter-bank Settlements in ________ Mumbai Kolkatta Agra Jaipur 3. Contract size, In the case of USD/INR it is USD _______ 10 100 1000 10000 4. __________ can be defined as the futures price minus the spot price. Basis Term Currency None of the Above 5. The Committee on Fuller Capital Account Convertibility had recommended that currency futures may be introduced subject to risks being contained through proper trading mechanism, structure of contracts and regulatory environment. True False Both of Above None of Above

6. The Standardized currency futures shall have the following features: Only USD-INR contracts are allowed to be traded.& The size of each contract shall be USD 1000. The contracts shall be quoted and settled in Indian Rupees. The maturity of the contracts shall not exceed 12 months. All of the Above 7. The membership of the currency futures market of a recognised stock exchange shall be separate from the membership of the equity derivative segment or the cash segment. True False Both of Above None of Above 8. On 15th April Mr.Anil sold a April USDINR futures contract at Rs.44000. Each USDINR futures contract is for delivery of USD1000. The RBI reference rate for final settlement was fixed as 44.10. How much profit/loss did he make? Profit 6000 Loss 300 Profit 100 Loss 100 9. BID rate is Buyers price Sellers Price Auction price Future price 10. _________ form a key part of the risk management system Trading Broking inquiry Margins

1. The relationship between futures prices and spot prices can be summarized in terms of what is known as the cost of carry. True False Both of Above None of Above

2. If domestic currency depreciates against the foreign currency, the exposure would result in gain for residents purchasing foreign assets and loss for non residents purchasing domestic assets. True False Both of Above None of Above 3. If you are Bullish on USD you will Buy USD Sell USD Both of the Above None of the above 4. Currency futures are used to hedge import/export risks. True False Both of Above None of Above 5. The Exchange imposes stringent penalty on members who do not collect margins from their clients. True False Both of Above None of Above 6. The Clearing Corporation of the Exchange, on an ongoing basis and at least once in every _____ months, conducts back-testing of the margins collected vis--vis the actual price changes Six Three Nine Twelve 7. The unique client code is assigned with the use of Income Tax Permanent Account Number (PAN) number. True False Both of Above None of Above

8. The Currency Futures trading system of NSE is called as _________. NEAT-CDS NEAT NEAT-F&O BOLT 9. When the Price Changes showing Improvement in the rate what color does it appear. Yellow Orange Red Blue 10. A dealer for Currency Derivatives market segment has to clear NISM-Series-I _______________ Currency Derivatives Cerifification Exams Capital Market Dealers Module exams AMFI Module Exams Depository Module Exams

1. Currency risks could be hedged mainly through Forwards Futures Swaps and Options All of the above 2. USD/INR Spot rate is 42.0025 and Forward rate 42.2525 and one month futures are 43.5000, What will an arbitrager do? Sell Futures, Buy Spot Sell Futures, Buy Forward Sell Forward, Buy Futures Sell Futures, Sell Spot 3. SPAN Risk is a _______ risk Portfolio Position Both of the Above None of the above

4. Among which of the following is the best sell order 42.0025/42.2500 42.0125/42.0150 42.0000/42.0100 42.0010/42.0125 5. The clearing members liquid networth after adjusting for the initial margin and extreme loss margin requirements must be at least Rs. 50 lakhs at all points in time True False Both of Above None of Above 6. The client margins (initial margin, extreme-loss margin, calendar-spread margin, and mark-to-market settlements) are compulsorily collected and reported to the Exchange by the members. True False Both of Above None of Above 7. In foreign exchange markets, in a currency pair, the _____ currency is called as the terms currency. First Second Third Fourth 8. The Currency Futures trading system of NSE supports a(n) __________. Quote driven market Order driven market Trade driven market None of the above

9. The system is normally made available for trading on all days except saturdays Sundays Holidays All of the Above 10. The dealer can view previous trades for _______ id only. Trading Member Branch Manager Own user Corporate Manager 1. The directions issued under section _______ of the Reserve Bank of India Act, 1934 are titled Currency Futures (Reserve Bank) Directions, 2008 came into force w.e.f. 6th August, 2008. 45X 45W 45V 45Z 2. Short Hedger will Long currency futures Short Currency Futures Both of the Above None of the Above 3. Minimum age for admission as a Trading Member of Currency Futures Derivatives Segment is 21 years 18 years 25 years 50 Years 4. In foreign exchange markets,in a currency pair, the second currency is called as the ____ currency. Term Base

Basis Fix 5. If a trader in the currency futures market expects INR will appreciate against USD then he will buy USD/INR True False Both of Above None of Above 6. In an Equal Hedge, the total value of the futures contracts involved is the same as the value of the spot market position. False True Both of Above None of Above 7. In order to achieve VAR, the price scan range is fixed at 3.5 standard deviation. True False Both of Above None of Above 8. The objective of NSCCL- SPAN is to identify _____________ of all futures contracts for each member. the transactions clients overall risk in a portfolio None of the above 9. The orders are stored in the NEAT System as per the _______ priority. Time/price Time Price Price/time

10. When the trading member does Trade in his own A/c it is entered as PRO CLI WHS FII

1. Among which of the following is the best Buy order 42.0025/42.2500 42.0125/42.0150 42.0000/42.0100 42.0010/42.0125 2. CME offers 41 individual FX futures and 31 options contracts on 19 currencies, all of which trade electronically on the exchanges CME Globex platform. It is the largest regulated marketplace for FX trading. True False Both of Above None of Above

3. F(0,T) = S0(1+ r)^T/ (1+p)^T . This is a Spot Forward r& p Formula True False Both of Above None of Above 4. On January 31 2008, the spot USD/INR rate was 43.50. The US interest rate was 3 percent, while the Indian interest rate was 6 percent. Find out the fair value of USD/INR Futures. The time to expiration was 90/360 = 0.25.

42.82 43.82 44.82 45.82 5. The __________ is the third most traded currency in the world. Japanese Yen US Dollar GBP INR 6. A futures contract is a Customized contract True False Both of Above None of Above 7. The last business day of the month will be termed the Value date / Final Settlement date of each contract. True False Both of Above None of Above 8. The inquiry window of the NSEs Currency Futures trading system enables the user to view _________________. Market By Price (MBP) Previous Trades (PT) Activity Log (AL) All of the above 9. Price at which an order gets triggered from the stop loss book. Regular order Stop Loss Order Odd Lot Normal Order 10. A best buy order is the order with the ______ price. Lowest Highest Middle Any Order

1. The Forward Rate is derived by adjusting the Spot rate for the interest rate differential of the two currencies for the period between the Future and the Forward date. True False Both of Above None of Above

2. ___________ refers to money denominated in the currency of another nation or a group of nations INR Foreign Exchange Dollar Euro 3. INR Indian Rupees International Rupees Indiana Rupees None of the above 4. The ________ has a strong international presence and over the years has emerged as a premier currency, second only to the US Dollar. Japanese Yen Euro GBP Swiss Franc 5. Final Settlement rate would be the _______ Reference rate for the date of expiry. SEBI Reserve Bank (RBI) FMC FEDAI 6. At Client Level the gross open position of the client across all contracts should not exceed 6% of the total open interest or USD 10 million whichever is higher. True False Both of Above None of Above

7. Non-Bank Trading Member Level i.e. The gross open positions of the trading member across all contracts should not exceed 15% of the total open interest or USD 50 million whichever is higher. However, the gross open position of a Trading Member, which is a bank, across all contracts, shall not exceed 15% of the total open interest or USD 100 million, whichever is higher. True False Both of Above None of Above

8. A tick is the _____________ at which traders are able to enter bids and offers. maximum trading increment price minimum trading increment None of the above 9. When the trading member does Trade in his client A/c it is entered as PRO CLI WHS FII 10. MTM is calculated at the end of the day on all open positions by comparing transaction price with the closing price of the share for the _______ Previous day Day Next day Last Friday

1. Exchange rates are quoted in per unit of the ______ currency. Term Base Basis

Fix

2. A foreign exchange swap is a simultaneous purchase and sale, or sale and purchase, of identical amounts of one currency for another with two different value dates. True False Both of Above None of Above 3. The Forward Rate is derived by adjusting the Spot rate for the interest rate differential of the two currencies for the period between the Spot and the Forward date. True False Both of Above None of Above 4. Almost every nation has its own national currency or monetary unit - used for making and receiving payments within its own borders False True Never true Always false 5. An optimal hedge is one where the changes in the spot prices are negatively correlated with the changes in the futures prices and perfectly offset each other. True False Both of Above None of Above 6. The Clearing Corporation assists the CM to monitor the intra-day limits set up by a CM and whenever a TM exceeds the limits, it stops that particular TM from further trading. True False Both of Above None of Above

7. The initial margin so computed would be subject to a minimum of 1.75% on the first day of currency futures trading and 1% thereafter. True False Both of Above None of Above 8. Trading members are required to keep an Interest Free Security Deposit with NSCCL. True False Both of Above None of Above 9. [(Total Buy Qty X Close price) - Total Buy Value] - [Total Sale Value- (Total Sale Qty X Close price)]= MTM loss/profit Actual loss/profit Gross Profit Gross Loss 10. The mark to market margin (MTM) is collected from the member before the start of the trading of the _____ day Next last T+2 T+3 1. Settlement Price Daily mark to market settlement price will be the closing price of the futures contracts for the trading day and the final settlement price shall be the RBI reference rate for last trading date of the contract. True False Both of Above None of Above 2. The closing price for a futures contract is currently calculated as the last half an hour weighted average price of the contract. True False Both of Above None of Above

3. At ________ the gross open position of the client across all contracts should not exceed 6% of the total open interest or USD 10 million whichever is higher. Trading member Level Client Level Clearing Member level Dealer 4. Clearing Member Level i.e. No separate position limit is prescribed at the level of clearing member. However,the clearing member shall ensure that his own trading position and the positions of each trading member clearing through him are within the limits specified above. True False Both of Above None of Above 5. If you are Bearish on USD you will Buy USD Sell USD Both of the Above None of the above 6. If a trader in the currency futures market expects INR will depreciate against USD then he will sell USD/INR True False Both of Above None of Above 7. In an Optimal Hedge, the total value of the futures contracts involved is the same as the value of the spot market position. False True Both of Above None of Above 8. The Final Settlement price of a Currency Futures contract is the ____________. MIBOR rate on the last trading day of the futures cont ract LIBOR reference rate on the last trading day of the futures contract RBI reference rate on the last trading day of the futures contract None of the above 9. Who receives end of day reports from all branches & dealers under same trading member Corporate manager Branch Manager

Dealer Trader 10. ________ loss is calculated by marking each transaction in security to the closing price of the security at the end of trading Mark to market M2M Daily Net Total

1. _______ currencies are usually needed for payments across national borders INR Foreign Dollar Euro 2. The Euro has a strong international presence and over the years has emerged as a premier currency, second only to the _______. Japanese Yen US Dollar GBP Swiss Franc 3. The first stock index futures contract was traded at _________ Kansas City Board of Trade National stock Exchange Bombay stock Exchange None of the above 4. A Forwad contract is a standardized contract True False Both of Above None of Above 5. The calendar spread margin is at a value of _______ for all months of spread Rs.50 Rs.150 Rs.250 Rs.500

6. For a calendar spread position, the extreme loss margin is charged on one-third of the mark-to-market value of the far-month contract True False Both of Above None of Above 7. Extreme loss margin is computed at 1% on the mark-to-market value of the Gross Open Position. True False Both of Above None of Above 8. A derivatives contract cannot exist without an ________ Exchange Underlying be it equity, interest rate etc. increase in volatility increase in arbitrage 9. Hedging is used for removal of Unwanted ________ Var Exposure or Risk Profits Shares 10. Disclosed Quantity is a ___________ condition Quantity or Volume Condition Time Condition Price Condition None of the Above

1. An ______ Hedge is a hedging strategy which yields the highest level of utility to the hedger. Basic Partial Optimal All of the Above

2. An intra-currency pair spread consists of one long futures and one short futures contract. Both have the same underlying but different maturities True False Both of Above None of Above 3. _________ means locking in a profit by simultaneously entering into transactions in two or more markets Hedging Trading Arbitrage Speculation 4. _______ Day is Last working day of the month (subject to holiday calendars) Expiry Trading Buying Selling 5. If you are Bearish on INR you will Buy USD Sell USD Both of the Above None of the above 6. If a trader in the currency futures market expects INR will appreciate against USD then he will sell USD/INR True False Both of Above None of Above 7. The ______ business day of the month will be termed the Value date / Final Settlement date of each contract. Last Thursday Last First day Either of the above

8. In the Currency Derivatives segment, trading member-cum-clearing member, clear and settle their own trades as well as trades of other trading members (TMs). True False Both of Above None of Above 9. _____________ receives the End of Day reports for all branches of the trading member Corporate manager Dealer Branch manager None of the above 10. The branch manager is a term assigned to a user who is placed under the Dealer Trader Corporate Manager User 1. If a trader in the currency futures market expects INR will depreciate against USD then he will buy USD/INR True False Both of Above None of Above 2. A hedger has an Overall Portfolio (OP) composed of (at least) 2 positions. One is Underlying position & second is Hedging position with negative correlation with underlying position Hedging position with positive correlation with underlying position Either of the above None of the Above 3. Long hedge means Underlying position of long in the foreign currency and Hedging position of short in currency futures True False Both of Above None of Above

4. Spread movement is based on following factors: Interest Rate Differentials Liquidity in Banking System & Inflation Monetary Policy Decisions (Repo, Reverse Repo and CRR) All of the Above 5. Expiry date i.e the last trading day will be _____ business days prior to the Value date / Final Settlement Date. One Two Three Four 6. The relationship between futures prices and spot prices can be summarized in terms of what is known as the ___________ Profit Cost of Carry. Fair Value All of the above 7. If domestic currency appreciates against the foreign currency, the exposure would result in loss for residents purchasing foreign assets and gain for non residents purchasing domestic assets. True False Both of Above None of Above 8. The NSEs Currency Futures trading system also enables _________ trades. Spread Options Carry All of the above 9. AON is Anybody or nobody Any one All or None All or no one 10. Forward Contracts are __________ contracts Customized

Bi Laterlal OTC - Over the Counter All of the Above

1. An intra currency pair spread is a long-short position in futures on different underlying currency pairs. Both typically have the same maturity. False True Both of Above None of Above

2. Daily _______ settlement will be on a T +1 basis mark to market Initial Margin Brokerage None of the Above 3. Market Timing is for currency Futures Segment is from 9 am to 5 pm. True False Both of Above None of Above 4. Base price of the USD/INR Futures Contracts on the first day shall be the theoretical futures price. True False Both of Above None of Above 5. The Japanese Yen is the ______ most traded currency in the world. First Second Third Fourth

6. If you are Bullish on INR you will Buy USD Sell USD Both of the Above None of the above 7. Short hedge means Underlying position of long in the foreign currency and Hedging position of short in currency futures True False Both of Above None of Above 8. In the Currency Derivatives segment, all open positions will be multiplied by 2000 (contract size in USD) 1000 (contract size in USD) 3000 (contract size in USD) None of the above 9. Future Contracts are _____________ Contracts Standardized Multi Lateral Exchange Traded All of The Above 10. The most commonly used Swaps are Interest Rate Currency Both of the Above None of the Above

1. Trading in Currency Futures at NSE will be from _____. Friday and Saturday Wednesday to Friday Monday to Thursday Monday to Friday

2. NSCCL monitors positions of trading members _________

Offline End of the day Once a week Online 3. A receiver swaption is an option to receive ______ and pay _____ Fixed, Floating Floating, Fixed Unlimited, Unlimited Limited, Limited 4. The maximum brokerage chargeable by a trading member in relation to trades effected in the contracts admitted to dealing on the Currency Futures segment of NSE is fixed at ________ 1% 1.5% 2% 2.5% 5. Margins form a key part of the ________ Trading Management System Broking Management System Exchange Management System Risk Management System 6. When the order is for either doing the trade immediatly or deleting from the system is known as Good till Date Immediate or cancel All or None End of Day 7. Eligibility criteria of Currency Futures -The market wide position limit for an FII or NRI is Rs.50 crore Rs.30 crore Rs.100 crore They are not allowed to trade in the Currency Futures Market

8. The Act that was amended which cleared the ambiguity of OTC derivatives was __________. RBI Act OTC derivatives act SEBI Act None of the above 9. OTC Derivatives stand for ________ Over the Counter Derivatives Outstanding Transaction Credit Derivatives Options Trade Credit Derivatives Commodity price risks 10. There are no formal rules or mechanisms for ensuring market stability and integrity, and for safeguarding the collective interests of market participants. Which type of Derivatives contracts are being referred to here Over the Counter Derivatives Exchange traded derivatives Stock Futures Commodity derivatives

1. A payer swaption is an option to pay ______ and receive _____ Fixed, Floating Floating, Fixed Unlimited, Unlimited Limited, Limited 2. M to M Mark to Market Money to market Market to market Market to money 3. Which type of Derivatives contracts are generally not regulated by a regulatory authority and the exchange's self-regulatory organization, although they are affected indirectly by national legal systems, banking supervision and market surveillance? Stock Futures Exchange traded derivatives

Over the Counter Derivatives Commodity derivatives

4. In Currency futures contracts, the buyer and the seller lock themselves into a/an _________ for a specific value or delivery date. Interest Rate Discount Rate Exchange Rate Closing Rate 5. The amount of asset that has to be delivered under one contract is the _______. US Dollar Futures quantity Futures delivery Contract size 6. Unpredicted movements in exchange rates expose investors to ______. Dollar Risk Currency Risks Interest Rate risk Systematic Risk 7. The standardised items in a futures contract are ______. The date and the month of delivery The units of price quotation and minimum price change Location of settlement All of the above 8. Both Forwards and Futures are traded at the NSE CD True False Both of Above None of Above

9. Trading in Currency Futures at NSE can have the participation of Banks.

True False Both of Above None of Above

10. NSE trades in Currency ________. Futures Options Both of Above None of Above

1. __________ take advantage of Mispricings in the markets Hedgers Volatility Arbitragers Speculators 2. One year interest rates in US and India are say 5% and 10% respectively and the spot rate of USD in India is Rs. 43. Then one year USD-INR futures fair value is Rs.41.25 Rs.43.70 Rs.42.65 Rs.45.20

3. If an order does not find a match in the trading system, it is removed from the trading system after seven days removed from the trading system at the end of the day removed from the trading system on the expiry day removed from the trading system when the buyer / seller deletes 4. A client of a trading member is required to enter into _____ with the trading member before he can commence trading. an understanding an arrangement negotiations an agreement

_____

5. In the Currency Derivatives Segment Clients' positions are arrived at by summing together _____positions of each individual client. gross (buy + sell) net (buy - sell) net or gross clients positions are not taken into account in the Currency Derivatives Segment 6. The US Dollar took on a major vehicle currency role with the introduction of the Bretton Woods par value system False True Both of Above None of Above 7. For a calendar spread position, the extreme loss margin is charged on one-third of the mark-to-market value of the far-month contract False True Both of Above None of Above 8. FEDAI Foreign Exchange Developers Association of India Foreign Exchange During Association of India Foreign Exchange Dealers Association of India None of the above 9. NPA Non prepared Assets Non Prepared Association Non Performed Association Non Performing Assets 10. Best Buy Order 48/48.0525 48.05/48.0550 48/48.0225 48/48.0500

1. At the year-end, any balance in the Deposit for mark-to-market margin account should be shown as a deposit under the head current assets. True False Both of Above None of Above 2. The contract price of the contract that is squared-up should be determined using _______ method for calculating profit/loss on squaring-up. LIFO FIFO FILO All of the Above 3. The number of currency futures contracts having open position, number of units of currency futures pertaining to those contracts and the daily settlement price as of the balance sheet date should be disclosed separately for long and short positions, in respect of each series of currency futures. True False Both of Above None of Above 4. ___________ are eligible to become PCMs for Currency Futures Derivatives. SEBI Registered Custodians Banks Both of Above None of above 5. PRO type order stand for__________ Clients Proprietary Institutional There is no such type.

6. SEBI has instructed the exchange to have _______ committees so

that differences, disputes and claims between trading members and investors can be settled effectively and in a short time. Arbitrage Hedging Speculation Arbitration 7. Arbitration is a quasi judicial process of settlement of disputes between Trading Members, Investors, Subbrokers & Clearing Members and between Investors and Issuers (Listed Companies). True False Both of Above None of Above 8. Initial margin paid/payable should be debited to Initial margin - currency futures account True False Both of Above None of Above 9. Loss on derivative transactions can be set off against any other income during the year. True False Both of Above None of Above 10. Loss on derivative transactions can be set off against any other income during the year. In case the same cannot be set off, it can be carried forward to subsequent assessment year and set off against any other income of the subsequent year True False Both of Above None of Above

1. Loss on derivative transactions can be carried forward for a period of 8 assessment years. True False Both of Above

None of Above 2. A broker should always create false market either singly or in concert with others or indulge in any act detrimental to the investors interest or which leads to interference with the fair and smooth functioning of the market False True Both of Above None of Above 3. A sub-broker should issue promptly to his clients purchase or sale notes for all the transactions entered into by him with his clients within ______ of trade 24 hours 48 hours 76 hours 1 week 4. A sub-broker can match the purchase and sale orders of his clients without routing through a member-broker of the stock exchange with whom he is affiliated. False True Both of Above None of Above 5. A sub-broker should enter into a _______ agreement with his client and with the main broker specifying the scope of rights and obligations of the broker, sub-broker and such client of the sub-broker Tripartite Tryparty Tripaty Tripathi 6. No Trading Member or person associated with the Trading Member shall guarantee a client against a loss in any transactions effected by the Trading Member for such client. False True

Both of Above None of Above

7. At the balance sheet date,the balance in the Initial margin currency futures account should be shown separately under the head Current assets Current liabilities Revenue Either of the Above 8. In cases where instead of paying initial margin in cash, the client provides bank guarantees or lodges securities with the member, a disclosure should be made in the notes to the financial statements of the client True False Both of Above None of Above 9. Payments made or received on account of daily settlement by the client should be credited/debited to the bank account and the corresponding debit or credit for the same should be made to an account titled as Mark-to-market margin - currency futures account. True False Both of Above None of Above 10. Sometimes the client may deposit a lump sum amount with the trading member in respect of mark-to-market margin money instead of receiving/paying mark-to-market margin money on daily basis should be debited to an appropriate account, Deposit for mark-to- market margin account. True False Both of Above None of Above