A CDS spread is quoted in which unit?
ALots of shares
BPips on a pair
CBasis points
DIndex points moved
Answer & Solution
Correct answer: C. Basis points
The spread is charged in basis points per year on the notional amount.
Keep practising Derivatives Analysis and Valuation
Browse all Derivatives Analysis and Valuation questions for CA Final, or explore more Strategicfinancialmanagement topics.
Related questions
Which is the most widely used method for valuing real options, as most are American styledAn electric utility can switch between fuel sources. This is which type of option?In real options, what is non-recoverable upfront spending for flexibility called?An option to abandon for salvage value is equivalent to which financial option?Which option is equivalent to a call option on extra capacity?Which pricing method computes the average of past payouts and is only a rough guide?Why is Black-Scholes not a standard model for weather derivatives?Who struck the first weather derivative deal in July 1996?