- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 8. Currency Exchange Rates: Understanding Equilibrium Value
- Subject 1. Foreign Exchange Spot Markets
CFA Practice Question
Regarding the size of the bid-ask spread quoted to dealers' clients, which statement is FALSE?
B. Credit risk of clients' is one of the most important factors considered by dealers.
C. It is generally wider than the bid-ask spread in the interbank market.
A. Geopolitical events such as war may impact the size of bid-ask spread.
B. Credit risk of clients' is one of the most important factors considered by dealers.
C. It is generally wider than the bid-ask spread in the interbank market.
Correct Answer: B
This is due to the nature of short settlement cycle for spot FX transactions.
User Contributed Comments 2
| User | Comment |
|---|---|
| PJMOHAN | What about C? |
| PJMOHAN | Sorry clarified. C is true!! |