n NISM Certifications
NSM General NISM
Medium

With respect to the OTC market, what is TRUE for the value date of a forward contract?

Practice question from NISM Series I - Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    It can be customized for a maximum period of one year

  2. B

    It can be customized for a maximum period of six months

  3. C

    Value dates are only available for the month-end date

  4. It can be customized for any period up to 6 months maturity for USDINR and up to 1 year for other currency pairs

    Correct answer

Why this is the answer

OTC forwards are customizable up to 6 months for USDINR, and up to 1 year for other pairs.

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