HKSI Paper 9 (Derivatives) English Free Trial

Which of the following statements is true regarding accumulators ?

I. Investors have the obligation to purchase a fixed quantity of underlying assets on every other day within the contract period

II. Investors have the obligation to purchase a fixed quantity of underlying assets on each day within the contract period

III. The purchase price is set at a discount to the initial price

IV. The strike price is set at a discount to the initial price

Which of the following statements is true regarding OTC warrants?

I. They are structured in a similar way to warrants traded on the exchange

II. There are also others tailored to suit a particular client’s profile and for one-off use

III. They are structured in a similar way to derivatives traded on the exchange

IV. They are structured in the same way to futures traded on the exchange

Which of the following statements is false regarding ELN ?

I. Put option is related to bearish

II. Call option is related to bearish

III. purchasing a note + selling a call option = bearish

IV. purchasing a note + selling a put option = bullish

Which of the following statements is false regarding advantages of spread trading?

I. Lower overall risk of the trade

II. The yearly fluctuations of profit and loss for the spread position are slowed down

III. Lower break-even point of the trade

IV. Spread trading can be used to trade volatility of the underlying asset

Which of the following statements is true regarding Mini-Hang Seng Index (“Mini-HSI”)?

I. The futures were introduced last

II. The options were introduced first

III. They were designed to meet the needs of retail investors desiring to trade or hedge

IV. They were avoided to meet the needs of retail investors desiring to trade or hedge

Which of the following statements is true regarding warrants?

I. Investors can sell warrants

II. They are like options

III. Investors can buy them

IV. Investors can issue them

Which of the following statements is true regarding average-rate option?

I. Here the purchaser can exercise the option based on a price

II. Here it has a set strike price

III. Here it comes a set strike price

IV. None of the above

Which of the following statements is true regarding synthetic position ?

I. Buying a call and going short on a futures contract can create a synthetic short put position

II. Selling a call and going long on a futures contract can create synthetic long put position

III. Buying a call and going short on a futures contract can create a synthetic long put position

IV. Selling a call and going long on a futures contract can create synthetic short put position

Which of the following statements is true regarding option price?

I. Increased expiration will increase the price of only call option

II. Increased expiration will increase the price of only put option

III. Increased expiration will increase the price of both call option and put option

IV. All of the above

Which of the following statements is true regarding delta option price?

I. The option delta is the rate of change of the option price

II. Delta measures the sensitivity of an option price

III. Both of the above

IV. None of the above