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CTP · Question #330
CTP Question #330: Real Exam Question with Answer & Explanation
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Question
- (Topic 4) now, but has heard news that the Federal Reserve will start a purchasing program of longer term treasuries that will include 10-year notes. The purchase program would likely cause a lowering of market interest rates. The manager would also like to avoid having to use margin on a daily basis. To remove the price risk that may be associated with the Federal Reserve purchasing program, the portfolio manager would MOST LIKELY enter into an:
Options
- Ainterest rate swap.
- Binterest rate collar.
- Cinterest rate futures contract.
- Dinterest rate forward contract.
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