CTP - Module 5|Questions with complete solutions | 100% verified|21 pages
CTP - Module 5 Account takeover ANSWER- A type of fraud in which a hacker gains access to a company's bank account information and uses that information to remove funds from the account. Active hedging ANSWER- The process of using various financial instruments (in particular, derivatives) to reduce or eliminate risks associated with future cash flows, or the values of assets or liabilities. A core principle of treasury financial risk management, hedging is similar to the concept of buying insurance to protect an asset, and the purpose of the hedge is to insure the asset's value (or minimize the risk on a liability) when its market value fluctuates. Also known as financial hedging. Aggregate basis ANSWER- A method of establishing insurance policy deductibles in which the deductible is set on a per-period basis, regardless of the number of occurrences (claims). American option ANSWER- A type of option contract that can be executed or settled on or any time prior to the stated expiration date of the contract. Contrast with European option and Bermuda option. Arbitrage ANSWER- The process by which an asset is purchased in one financial market and sold in another market to produce a riskless profit. It is the primary mechanism that ensures efficiency in financial markets.
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- Publié le
- 17 décembre 2023
- Nombre de pages
- 21
- Écrit en
- 2023/2024
- Type
- Examen
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ctp module 5
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