The Phrase 'Yield Pick- Up' Refers To

question 63

Multiple Choice

The phrase 'yield pick- up' refers to:

• A) a capital gain that the holder of a swap enjoys when the RBA decreases interest rates.
• B) a gain that comes by switching from interest bearing to dividend bearing derivatives.
• C) an arbitrage profit that a trader picks up by buying and selling two swap contracts simultaneously.
• D) an increased floating rate yield obtained by investing in a high- yield bond and swapping into a floating- rate investment.

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Definitions:

Other Expenses

Costs that are not directly related to the production of goods or services, such as administrative and marketing expenses.

Planning Budget

A financial plan created to estimate a company’s revenue, expenses, and cash flow for a specific future period.

Refurbishing Materials

Materials used in the process of renovating or restoring products to a like-new condition.

Planning Budget

A budget prepared for a specific level of activity; it helps manage finances by projecting income and expenditures over a defined period.