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AIWMI CCRA-L2 Exam - Topic 5 Question 87 Discussion

Actual exam question for AIWMI's CCRA-L2 exam
Question #: 87
Topic #: 5
[All CCRA-L2 Questions]

Statement 1: The Yields on the MBS PTCs are normally higher than the yields on the corporate bonds of similar ratings.

Statement 2: The reason for difference in yields on the corporate bonds and similarly rated PTCs is on account of the optionality in the PTC, the unfamiliarity of the structure and uncertainties in respect of legal and structural issues.

Which of the above statements is correct?

Show Suggested Answer Hide Answer
Suggested Answer: D

by Kanisha at May 12, 2024, 05:24 PM

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Theron
4 months ago
Wait, are PTCs really that unfamiliar? I thought they were more common now.
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Eva
4 months ago
Both statements seem correct to me, they explain the yield difference well.
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Noble
4 months ago
I’m not so sure about that, isn’t it risky with those legal issues?
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Lucina
4 months ago
Totally agree, the optionality really affects yields!
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Desiree
5 months ago
Statement 1 is true, MBS PTCs usually have higher yields.
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Jerry
5 months ago
I feel like Statement 1 might be correct, but I also remember that the unfamiliarity of PTCs could justify the higher yields mentioned in Statement 2.
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Francesco
5 months ago
I practiced a similar question where we discussed the risks associated with PTCs, but I can't recall if that directly affects their yield compared to corporate bonds.
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Jarvis
5 months ago
I think Statement 2 makes sense because the optionality and legal issues can definitely create more risk, which could lead to higher yields.
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Elouise
5 months ago
I remember studying that MBS PTCs usually have higher yields due to their structure, but I'm not entirely sure if that's always the case.
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Fletcher
5 months ago
Based on my understanding, Statement 1 is generally true, so I'm inclined to go with option D and select that as the correct answer.
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Teddy
5 months ago
Hmm, I'm a bit confused by the wording of these statements. I'll need to re-read them carefully and think through the logic before deciding.
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Myra
5 months ago
The optionality and structural uncertainties mentioned in Statement 2 could definitely impact the yields, so I'm leaning towards that being the correct explanation.
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Nan
5 months ago
This question seems straightforward, but I want to make sure I understand the key differences between corporate bonds and MBS PTCs before selecting an answer.
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Shonda
6 months ago
Okay, this one's got me a bit stumped. The Financial Services Cloud option is intriguing, but I'm not sure if it's the best fit based on the details provided. I'll need to review the capabilities of each solution more closely to make a confident decision.
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Bulah
6 months ago
Hmm, this looks like a tricky one. I'll need to carefully review the options and think through the correct set of action types.
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Louisa
6 months ago
Okay, let's see here. The password reset disk option sounds promising, but I'm not sure if I have one set up. I'll have to check that first.
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