Reg. No.

DMI - ST. EUGENE UNIVERSITY

INSTITUTE OF VIRTUAL AND DISTANCE LEARNING
MASTER DEGREE EXAMINATIONS – JUNE 2023
SEM: III 575EE46 BONDS DERIVATIVES AND COMMODITY
MARKET MANAGEMENT
Time: 3:00 Hours Max. Marks: 100

Answer all questions

PART - A (10 X 2=20 marks)
1. What is meant by bonds attributes?
2. Define bond management strategies.
3. List any two(2) objectives of derivatives.
4. State the term swap.
5. How does future trade increase in economic efficiency?
6. Define call option.
7. What are the risks involved in commodity trading?
8. Mention any (2) two importance of commodities exchanges.
9. How to define the future settlements
10. Bring-forth two(2) facts which support the term ‘margin
trading’.
PART - B (5 X 4=20 marks)
11. (a) List any (4) four types of interest rate of bonds.
(OR)
11. (b) Why bond management strategies are more important?

12. (a) Briefly describe the market index.

(OR)
12. (b) Distinguish between futures and options in pay off.
13. (a) How would you evaluate the options trading? (OR)
(OR) 19. (b) What is securities exchange?Discuss details on how to
13. (b) Compare call option premium and put option premium. invest in the Lusaka Securities Exchange.

14. (a) How is trading adjustments applied to financial 20. (a) Assimilate facts on clearing and settlement of exchange
instruments? traded derivatives with illustration.
(OR) (OR)
14. (b) Identify any (2) two major drawbacks of equities. 20. (b) Analyse the implications of combining a risk-free asset
with portfolio.
15. (a) How can derivatives like contract, regulations help to
mitigate risk?
(OR)
15. (b) Write a short note on regulatory framework in Zambia.

PART- C (5 X 12=60 marks)

16. (a) What is the structure of interest rates? Explicate the types
of structure of interest rates.
(OR)
16.(b) Analyse the significance of bond portfolio management.

17.(a) Discuss the functions of payoff derivative contracts with

relevant examples.
(OR)
17.(b) Narrate various pros and cons of forward contract.

18.(a) Illustrate the steps involved in banks.

(OR)
18.(b)What is mechanism? How can it be made in settlement
mechanism?

19. (a) Deliberate the significance of commodity exchange and

how it is been carried out in Zambia.