G345 Final 2025/2026 Exam Questions
with 100% Correct Answers | Latest
1
Update
Exchange-Listed Derivatives - 🧠 ANSWER ✔✔Futures and Options
Over the Counter Market - 🧠 ANSWER ✔✔Forwards, swaps and options
Reasons to use derivatives - 🧠 ANSWER ✔✔hedge risks, speculative, arbitrage
profit, change the nature of a liability/investment
Forward Contract - 🧠 ANSWER ✔✔Define price today but payment/delivery is in
the future. No daily settlement. OTC. No money exchanges hands when negotiated
Pro: Flexible
Con: lack of liquidity, default risk
Future Contract - 🧠 ANSWER ✔✔Same as forward but are standardized in
amount, asset characteristics and delivery time;
Greater liquidity than forwards since they are traded on a secondary market
100% GUARATEED SUCCESS
COPYRIGHT©PROFFKERRYMARTIN 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE.
PRIVACY STATEMENT. ALL RIGHTS RESERVED
, Options - 🧠 ANSWER ✔✔Right to buy or sell an asset at a predetermined price by
a predetermined time. Insurance like features.
2
American vs European Option - 🧠 ANSWER ✔✔American: Exercise whenever
you want
European: Only exercise at expiration
Why use options rather than futures? - 🧠 ANSWER ✔✔Futures have accounting
problems. Future losses are offset by unrealized future profits in the rest of the
portfolio and it is not allowed to offset these losses in its accounting statements
Intrinsic Value of Options - 🧠 ANSWER ✔✔Call: Stock price - strike
Put: Strike - stock price.
"In the money" when positive
Time Value of an Option - 🧠 ANSWER ✔✔= Premium - intrinsic value
Premium you pay is entirely time value. "It's like ice cream"
Swaps - 🧠 ANSWER ✔✔agreements to exchange two securities or currencies at
specified future times. differences typically criteria used to calculate cash flows
(interest rates, inflation)
100% GUARATEED SUCCESS
COPYRIGHT©PROFFKERRYMARTIN 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE.
PRIVACY STATEMENT. ALL RIGHTS RESERVED
with 100% Correct Answers | Latest
1
Update
Exchange-Listed Derivatives - 🧠 ANSWER ✔✔Futures and Options
Over the Counter Market - 🧠 ANSWER ✔✔Forwards, swaps and options
Reasons to use derivatives - 🧠 ANSWER ✔✔hedge risks, speculative, arbitrage
profit, change the nature of a liability/investment
Forward Contract - 🧠 ANSWER ✔✔Define price today but payment/delivery is in
the future. No daily settlement. OTC. No money exchanges hands when negotiated
Pro: Flexible
Con: lack of liquidity, default risk
Future Contract - 🧠 ANSWER ✔✔Same as forward but are standardized in
amount, asset characteristics and delivery time;
Greater liquidity than forwards since they are traded on a secondary market
100% GUARATEED SUCCESS
COPYRIGHT©PROFFKERRYMARTIN 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE.
PRIVACY STATEMENT. ALL RIGHTS RESERVED
, Options - 🧠 ANSWER ✔✔Right to buy or sell an asset at a predetermined price by
a predetermined time. Insurance like features.
2
American vs European Option - 🧠 ANSWER ✔✔American: Exercise whenever
you want
European: Only exercise at expiration
Why use options rather than futures? - 🧠 ANSWER ✔✔Futures have accounting
problems. Future losses are offset by unrealized future profits in the rest of the
portfolio and it is not allowed to offset these losses in its accounting statements
Intrinsic Value of Options - 🧠 ANSWER ✔✔Call: Stock price - strike
Put: Strike - stock price.
"In the money" when positive
Time Value of an Option - 🧠 ANSWER ✔✔= Premium - intrinsic value
Premium you pay is entirely time value. "It's like ice cream"
Swaps - 🧠 ANSWER ✔✔agreements to exchange two securities or currencies at
specified future times. differences typically criteria used to calculate cash flows
(interest rates, inflation)
100% GUARATEED SUCCESS
COPYRIGHT©PROFFKERRYMARTIN 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE.
PRIVACY STATEMENT. ALL RIGHTS RESERVED
