NEW EXAM 8011 ASSESSMENT | VALID PRMIA RELIABLE 8011 TEST CAMP: CREDIT AND COUNTERPARTY MANAGER (CCRM) CERTIFICATE EXAM

New Exam 8011 Assessment | Valid PRMIA Reliable 8011 Test Camp: Credit and Counterparty Manager (CCRM) Certificate Exam

New Exam 8011 Assessment | Valid PRMIA Reliable 8011 Test Camp: Credit and Counterparty Manager (CCRM) Certificate Exam

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PRMIA's CCRM certification is highly regarded in the financial industry and is recognized by a number of leading financial institutions around the world. Credit and Counterparty Manager (CCRM) Certificate Exam certification provides professionals with a competitive edge in the job market and demonstrates their commitment to excellence in credit and counterparty risk management.

PRMIA Credit and Counterparty Manager (CCRM) Certificate Exam Sample Questions (Q99-Q104):

NEW QUESTION # 99
When performing portfolio stress tests using hypothetical scenarios, which of the following is not generally a challenge for the risk manager?

  • A. Building a consistent set of hypothetical shocks to individual risk factors
  • B. Building a positive semi-definite covariance matrix
  • C. Evaluating interrelationships between counterparties when considering liquidity risks
  • D. Considering back office capacity to deal with increased transaction volumes

Answer: D

Explanation:
Choice 'c' relates to operational risk and process capabilities, generally not a concern when evaluating market risk of a portfolio. Choice 'a', Choice 'b' and Choice 'd' represent real concerns for the risk manager when building stress tests for the value of a portfolio.
Choice 'a' is relevant because certain shocks may be inconsistent with each other, and thereforeimplausible.
For example, an increase in futures prices may be inconsistent with without spot prices and/or interest rates increasing according to the no-arbitrage condition. Choice 'b' is relevant when modeling a covariance matrix in a stressed situation with higher correlations, as a hypothetical covariance matrix which is not positive semi- definite may give absurd results (negative variance). Choice 'd' is relevant as liquidity risks may affect the price that can be realized for positions held.


NEW QUESTION # 100
Which of the following can be used to reduce credit exposures to a counterparty:
I. Netting arrangements
II. Collateral requirements
III. Offsetting trades with other counterparties
IV. Credit default swaps

  • A. III and IV
  • B. I and II
  • C. I, II and IV
  • D. I, II, III and IV

Answer: C

Explanation:
Offsetting trades with other counterparties will not reduce credit exposure to a given counterparty. All other choices represent means of reducing credit risk. Therefore Choice 'c' is the correct answer.


NEW QUESTION # 101
Under the CreditPortfolio View approach to credit risk modeling, which of the following bestdescribes the conditional transition matrix:

  • A. The conditional transition matrix is the transition matrix adjusted for the distribution of the firms' asset returns
  • B. The conditional transition matrix is the unconditional transition matrix adjusted for the state of the economy and other macro economic factors being modeled
  • C. The conditional transition matrix is the unconditional transition matrix adjusted for probabilities of defaults
  • D. The conditional transition matrix is the transition matrix adjusted for the risk horizon being different from that of the transition matrix

Answer: B

Explanation:
Under the CreditPortfolio View approach, the credit rating transition matrix is adjusted for the state of the economy in a way as to increase the probability of defaults when the economy is not doing well, and vice versa. Therefore Choice 'a' is the correct answer. The other choices represent nonsensical options.


NEW QUESTION # 102
Which of the following are likely to be useful to a risk manager analyzing liquidity risk for an international bank?
I. Information on liquidity mismatches
II. Funding concentration
III. Lending concentration
IV. A report on illiquid assets

  • A. III and IV
  • B. I and II
  • C. I, II, III and IV
  • D. I, II and IV

Answer: C

Explanation:
All of the listed reports (or information) would be useful to a risk manager analyzing liquidity risk. Therefore Choice 'c' is the correct answer. Additionally, reports on assets brought on margin (that may result in collateral or margin calls), trading exposures to different counterparties, reports on financial health, share price and credit ratings of key counterparties will also be useful.


NEW QUESTION # 103
When modeling operational risk using separate distributions for loss frequency and loss severity, which of the following is true?

  • A. Loss severity and loss frequency are considered independent
  • B. Loss severity and loss frequency are modeled using the same units of measurement
  • C. Loss severity and loss frequency distributions are considered as a bivariate model with positive correlation
  • D. Loss severity and loss frequency are modeled as conditional probabilities

Answer: A

Explanation:
When modeling operational loss frequency distribution (which, for example, may be based upon a Poisson distribution) and a loss severity distribution (for example, based upon a lognormal distribution), it is assumed that the frequency of losses and the severity of the losses are completely independent and do not impact each other. Therefore Choice 'a' is correct, and the others are not valid assumptions underlying the operational loss modeling.
Once each of these distributions has been built, a random number is drawn from each to determine a loss scenario. The process is repeated many times as part of a Monte Carlo simulation to get a the loss distribution.


NEW QUESTION # 104
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