1. True – False. Bottom-up investment approaches are duration management, yield curve positioning and sector selection.
2. Would an asset backed security typically pay more or less interest than a comparable non-asset backed security? (think risk)
3. Please briefly describe a credit default swap:
4. Why is predicting prepayments important for mortgage backed securities? When would we typically see higher prepayments
5. A money market fund has hit the value of $0.99 cents. It has
a) Broken the buck
b) It will not implement shadow pricing
c) It will continue to trade as normal
6. Please compare and contrast fundamental vs quantitative research:
7. True/False. Technical analysis seeks to predict stock performance by examining price trends.
8. Briefly describe what a spread is on a trade order? What does it say about liquidity?
9. Please briefly describe Market Impact in relation to large trades:
10. What is a basket trade? (think mutual funds)
11. When we say a broker is working a trade what does that mean and what is the goal?
12. True/False. Hedge funds and other large money managers do not like to use dark pools because it exposes their strategy to the market.
13. How would you contrast a value vs growth stock?
14. True/False Bottom-up investment approaches are issue selection and predicting calls or prepayments
15. In an environment of rising interest rates a zero coupon bond with a 5 year maturity would have:
a) A duration less than 5 years
b) A duration equal to 5 years
c) A duration greater than 5 years