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PRMIA 8004 Exam Syllabus Topics:
| Section | Objectives |
|---|---|
| Topic 1: Standards & Practices | - Standards of Best Practice, Conduct and Ethics, PRMIA Ethics Committee - Bylaws of Professional Risk Managers' International Association, PRMIA - Principles of Good Governance Principles, PRMIA - Group of Thirty Best Practices, Global Derivatives Study Group |
| Topic 2: Case Studies | - Bankers Trust - Northern Rock - Orange County - National Australia Bank (NAB) - FX Options - Barings - Long Term Capital Management (LTCM) - FTX - Operational Resilience at TSB - Lehman Brothers - American Insurance Group (AIG) - Metallgesellschaft - Silicon Valley Bank - Washington Mutual (Wamu) - Fannie Mae and Freddie Mac - WorldCom |
PRMIA PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics Sample Questions:
1. Which of the following was the key contributory risk factor to the problems at LTCM in the summer of 1998?
I Model Risk
II Lack of Transparency
III Breakdown of Historical Correlations
IV Over Regulation by Federal Regulators
A) I and III only
B) All of these were key elements of the problems at LTCM
C) III and IV only
D) III only
2. The problems at Bankers Trust can best be characterized as failures related to:
A) All of the Above
B) Credit Risk
C) Market Risk
D) Operational and Regulatory Compliance Risk
3. The key people involved in the application of good governance and risk management must:
I be trustworthy
II be honest
III be approved by the local regulator
IV treat others fairly at all times
A) I, II, and IV only
B) I, II, III and IV above
C) I, II, and III only
D) III only
4. The early 2003 trading strategy of China Aviation oil was
A) to buy puts and sell calls
B) to sell puts and buy calls
C) to sell calls and buy puts
D) to buy calls and sell puts
5. What was the main type of risk that Metallgesellschaft was exposed to?
A) Interest Rate
B) Basis Risk
C) Inflation
D) Currency Settlement
Solutions:
| Question # 1 Answer: D | Question # 2 Answer: D | Question # 3 Answer: A | Question # 4 Answer: D | Question # 5 Answer: B |


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