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PRMIA Exam 8006 Topic 5 Question 87 Discussion

Actual exam question for PRMIA's 8006 exam
Question #: 87
Topic #: 5
[All 8006 Questions]

A bullet bond refers to a bond:

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Suggested Answer: A

A short squeeze results when short sellers are trying to cover their short positions by buying in the spot markets, which do not have adequate supply. This results in sharp spikes in spot prices, which further forces any other shorts to try cut their losses. The result is a sharp rise in spot prices.

Choice 'a' is the correct answer, the other choices do not describe a short squeeze.


by Cyril at May 07, 2024, 10:07 AM

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Kindra
12 months ago
Ok, I see your points. A it is!
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Marilynn
1 years ago
I agree with A too. B seems less likely.
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Georgiann
1 years ago
A sharp increase in spot prices? Makes sense because shorts can panic and buy-up.
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Anisha
1 years ago
I think the answer is A. It fits well with the definition I've learned.
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Kindra
1 years ago
Yeah, financial terms can be confusing.
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Bernardo
1 years ago
This question on short squeeze is tricky.
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