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PRMIA Exam 8010 Topic 1 Question 69 Discussion

Actual exam question for PRMIA's 8010 exam
Question #: 69
Topic #: 1
[All 8010 Questions]

For credit risk calculations, correlation between the asset values of two issuers is often proxied with:

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Suggested Answer: D

Choice 'b', Choice 'c' and Choice 'a' correctly describe a bilateral close out netting as recommended by the ISDA. However Choice 'd' is not correct as it suggests individual settlement of transactions without netting which is the whole point of bilateral close out netting.


by Anastacia at Mar 20, 2025, 08:15 PM

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Elizabeth
9 days ago
I'm not sure, but I think it could also be A) Credit migration matrices. It's important to consider the movement of credit ratings.
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Bulah
10 days ago
I agree with Deonna. Default correlations make sense for credit risk calculations.
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Deonna
14 days ago
I think the answer is D) Default correlations.
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