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Question of the Week - Fixed Income

exam_whizexam_whiz IllinoisPosts: 68 Sr Associate
edited May 2014 in Level 1 Questions
Which of the following statements relating to Z-spread, Option-adjusted spread (OAS) and option cost for callable and putable bonds is/are most likely correct?

I: For callable bonds, Z-spread is greater than OAS and option cost is greater than 0
II: For callable bonds, Z-spread is less than OAS and option cost is greater than 0
III: For putable bonds, Z-spread is less than OAS and option cost is greater than 0

Question of the Week - Fixed Income 33 votes

All three statements are correct
0%
Only statement II is correct
36%
senthil_85mbnmichael17NaidenBSamirHasanovschwar1kmighty_ducks_8ninerfan308Teemotoonervashannondailyroverfanclubferocious 12 votes
Only statement I is correct
63%
ZeesethnehaLagartarobw787RoyDHmelendeznar_bsoakevinpb639akatorancornwellantmart2shazcraigydSharvey518jak5189simply_complex2thendry7rachelmabrahmb2rdx 21 votes

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