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AIWMI Exam CCRA-L2 Topic 1 Question 96 Discussion

Actual exam question for AIWMI's CCRA-L2 exam
Question #: 96
Topic #: 1
[All CCRA-L2 Questions]

The following information pertains to bonds:

Further following information is available about a particular bond 'Bond F'

There is a 10.25% risky bond with a maturity of 2.25% year(s) its current price is INR105.31, which corresponds to YTM of 9.22%. The following are the benchmark YTMs.

Compute interpolated spread for Bond F based on the information provided in the vignette:

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Suggested Answer: D

by Stevie at Sep 08, 2024, 02:31 PM

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Jamey
19 days ago
Wait, is this a trick question? What if the answer is actually 'All of the above'? I'm going to overthink this, aren't I?
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Chaya
20 days ago
Alright, time to channel my inner bond wizard. This is going to be a piece of cake... or a hot mess. We'll see!
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Linsey
1 months ago
Ugh, bond math. Why can't they just ask something simple, like 'What's the capital of Australia?'
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Juliann
9 days ago
I think the answer might be A) 1.64%.
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Ethan
13 days ago
I know, bond math can be tricky sometimes.
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Lashawn
1 months ago
Okay, I think I've got it. Using the benchmark YTMs, I can interpolate the spread. This is a good way to test our understanding of bond pricing and yields.
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Gearldine
23 days ago
Hmm, I'm leaning towards B) 0.43%.
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Kristine
26 days ago
B) 0.43%
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Paz
27 days ago
I think it's A) 1.64% too.
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Edelmira
1 months ago
A) 1.64%
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Nieves
1 months ago
Hmm, let's think this through. The bond has a YTM of 9.22%, and the benchmark YTMs are provided. I'll need to use those to interpolate the spread.
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Shonda
2 months ago
Yes, I think we need to use the formula for interpolated spread to find the correct answer.
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Darrel
2 months ago
I agree, but I believe we can use the benchmark YTMs to calculate it.
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Shonda
2 months ago
I think the question about computing interpolated spread for Bond F is tricky.
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