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PRMIA Exam 8006 Topic 5 Question 87 Discussion

Actual exam question for PRMIA's 8006 exam
Question #: 87
Topic #: 5
[All 8006 Questions]

A bullet bond refers to a bond:

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Suggested Answer: A

A short squeeze results when short sellers are trying to cover their short positions by buying in the spot markets, which do not have adequate supply. This results in sharp spikes in spot prices, which further forces any other shorts to try cut their losses. The result is a sharp rise in spot prices.

Choice 'a' is the correct answer, the other choices do not describe a short squeeze.


by Cyril at May 07, 2024, 10:07 AM

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Kindra
10 months ago
Ok, I see your points. A it is!
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Marilynn
10 months ago
I agree with A too. B seems less likely.
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Georgiann
11 months ago
A sharp increase in spot prices? Makes sense because shorts can panic and buy-up.
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Anisha
11 months ago
I think the answer is A. It fits well with the definition I've learned.
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Kindra
11 months ago
Yeah, financial terms can be confusing.
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Bernardo
11 months ago
This question on short squeeze is tricky.
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