ACI
3I0-013 · Question #265
You are an issuer of a straight bond and you want to change your exposure from a fixed rate to a floating rate because you expect a fail in interest rates. What would you do?
The correct answer is C. Buy a FRA. See the full explanation below for the reasoning.
Question
You are an issuer of a straight bond and you want to change your exposure from a fixed rate to a floating rate because you expect a fail in interest rates. What would you do?
Options
- ABuy an IRS
- BSell an IRS
- CBuy a FRA
- DDo nothing because the bond coupon is already a fixed rate
How the community answered
(39 responses)- A15% (6)
- B5% (2)
- C72% (28)
- D8% (3)
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