n NISM Certifications
VII NISM Series VII
Medium

In the event of a default, utilization of the Settlement Guarantee Fund follows a sequence known as ______.

Practice question from NISM Series VII Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Default Rainfall

  2. Default Waterfall

    Correct answer

  3. C

    Default Payment

  4. D

    Default Utilization

Why this is the answer

The Default Waterfall specifies the sequence of resources a Clearing Corporation uses to cover obligations of defaulted members.

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