PRMIA 8011 VALID BRAINDUMPS FREE - 8011 FREQUENT UPDATES

PRMIA 8011 Valid Braindumps Free - 8011 Frequent Updates

PRMIA 8011 Valid Braindumps Free - 8011 Frequent Updates

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8011 practice questions and pass it with confidence. As far as the top features of 8011 exam dumps are concerned, these PRMIA 8011 latest questions are real and verified by PRMIA 8011 certification exam experts. With the PRMIA 8011 Practice Test questions you will get everything that you need to learn, prepare and get success in the final Credit and Counterparty Manager (CCRM) Certificate Exam certification exam.

PRMIA 8011 Certification Exam is a computer-based exam that consists of 80 multiple-choice questions. Candidates have three hours to complete the exam, and a passing score of 60% is required to earn the certification. 8011 exam is offered in multiple languages and can be taken at testing centers around the world.

PRMIA 8011 CCRM certification exam covers a wide range of topics, including credit risk management principles, quantitative methods for credit risk analysis, credit risk modeling, counterparty risk management, and financial derivatives. It is a comprehensive exam that requires a deep understanding of finance, risk management, and regulatory frameworks. Passing 8011 Exam demonstrates a candidate's expertise in credit and counterparty risk management and their ability to apply sound risk management principles to complex financial instruments. With this certification, professionals can advance their careers as credit risk managers, financial analysts, or consultants in the financial sector.

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PRMIA - Newest 8011 - Credit and Counterparty Manager (CCRM) Certificate Exam Valid Braindumps Free

The web-based 8011 practice exam can be taken via the internet from any browser like Firefox, Safari, Opera, MS Edge, Internet Explorer, and Chrome. You don’t need to install any excessive plugins and software to take this PRMIA 8011 Practice Test. Windows, Mac, iOS, Android, and Linux support this Credit and Counterparty Manager (CCRM) Certificate Exam (8011) practice exam.

PRMIA 8011: Credit and Counterparty Risk Manager (CCRM) certification is valuable for both individuals and organizations. It helps individuals to enhance their knowledge, skills, and reputation, while organizations can benefit from having certified employees that can help manage credit and counterparty risk more effectively. In conclusion, the CCRM certification has become an important asset for anyone seeking to take their career to the next level in the financial industry.

PRMIA Credit and Counterparty Manager (CCRM) Certificate Exam Sample Questions (Q168-Q173):

NEW QUESTION # 168
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 distributions are considered as a bivariate model with positive correlation
  • B. Loss severity and loss frequency are considered independent
  • C. Loss severity and loss frequency are modeled as conditional probabilities
  • D. Loss severity and loss frequency are modeled using the same units of measurement

Answer: B

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 # 169
Which of the following decisions need to be made as part of laying down a system for calculating VaR:
I. How returns are calculated, eg absoluted returns, log returns or relative/percentage returns II. Whether VaR is calculated based on historical simulation, Monte Carlo, or is computed parametrically III. Whether binary/digital options are included in the portfolio positions IV. How volatility is estimated

  • A. All of the above
  • B. II and IV
  • C. I and III
  • D. I, II and IV

Answer: D

Explanation:
While conceptually VaR is a fairly straightforward concept, a number of decisions need to be made to select between the different choices available for the exact mechanism to be used for the calculations.
There is more than one way to calculate returns. Absolute returns may be relevant for risk factors where the size of the movement is unrelated to its current value. For other risk factors, the returns might scale with the size of the existing value of the risk factor, eg equity prices. The right return definition needs to be adopted for each risk factor, therefore 'I' is a correct choice.
The risk analyst has a Choice 'b'etween parametric VaR, Monte Carlo, and historical simulation based VaR.
'II' therefore is one of the decisions that needs to be made (though historical simulation is the choice most often made).
The decision as to what to include in a portfolio is not a decision that is affected by choices made for VaR calculations. 'III' is therefore not a correct answer.
There are multiple ways to calculate volatility - including decisions on how long back in time to go for the data, and whether volatility clustering needs to be accounted for using EWMA or GARCH. Therefore 'IV' is a correct answer.


NEW QUESTION # 170
If the systematic VaR for an equity portfolio is $100 and the specific VaR is $80, then which of the following is true in relation to the total VaR:

  • A. Total VaR is greater than $180
  • B. Total VaR is less than $180
  • C. Total VaR is $20
  • D. Total VaR is $180

Answer: B

Explanation:
Choice 'd' is correct because VaR is sub-additive in cases where correlation is less than one.
Specific VaR refers to the risk in the portfolio from security selection, ie the risk from holding the specific equities in the portfolio, while systematic risk refers to the market risk. Definitionally, specific risk and systematic risk are uncorrelated, ie their correlation is zero. Since their correlation is zero, combining them will produce a VaR number lower than their stand alone aggregate. Total risk includes both specific risk and systematic risk, and can be calculated taking into account the specific and systematic VaRs and their correlation.
All other answers are therefore incorrect.


NEW QUESTION # 171
An operational loss severity distribution is estimated using 4 data points from a scenario. The management institutes additional controls to reduce the severity of the loss if the risk is realized, and as a result the estimated losses from a 1-in-10-year losses are halved. The 1-in-100 loss estimate however remains the same.
What would be the impact on the 99.9th percentile capital required for this risk as a result of the improvement in controls?

  • A. The capital required will stay the same
  • B. The capital required will decrease
  • C. Can't say based on the information provided
  • D. The capital required will increase

Answer: D

Explanation:
This situation represents one of the paradoxes in estimating severity that one needs to be aware of - the improvement in controls reduces the weight of the body/middle of the distribution and moves it towards the tails (as the total probability under the curve must stay at 100%) and the distributionbecomes more heavy tailed. As a result, the 99.9th percentile loss actually increases. instead of decreasing, creating a counterintuitive result. Therefore the correct answer is that the capital required will increase.
If scenario analysis produces such a result, the analyst must question if the 1 in 100 year loss severity is still accurate. If the new control has reduced the severity in the body of the distribution, the question as to why the more extreme losses have not changed should be raised.


NEW QUESTION # 172
Which of the following losses can be attributed to credit risk:
I. Losses in a bond's value from a credit downgrade
II. Losses in a bond's value from an increase in bond yields
III. Losses arising from a bond issuer's default
IV. Losses from an increase in corporate bond spreads

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

Answer: C

Explanation:
Losses due to credit risk include the loss of value from credit migration and default events (which can be considered a migration to the 'default' category). Therefore Choice 'd' is the correct answer. Changes in spreads or interest rates are examples of market risk events.
[Discussion: It may be argued that losses from spreads changing could be categorized as credit risk and not market risk. The distinction between credit and market risk is never really watertight.
The reason I have called it market risk in this question is because spreads can change due to two reasons: first, due to the individual issuer going down in their credit rating (whether issued or perceived, as we have witnessed in Europe sovereign debt), and second due to the spread for the overall category changing due to macro fundamentals with nothing changing for the individual issuer. For example the spread between municipal bonds and treasuries may be small during boom times and may expand during recessions - regardless of how the individual issuer has been doing. Clearly, the first case is credit risk and the second is probably market risk.
A change in overall corporate bond spreads is something I would consider akin to a rate change - which is why I have called it as not a part of credit risk. But an alternative perspective may not be incorrect either.]


NEW QUESTION # 173
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