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Basic Question 3 of 13

At 15% interest rate volatility the OAS for a callable bond is 20 bps. Which one is the MOST LIKELY OAS at 10% interest rate volatility?

A. 15 bps
B. 20 bps
C. 25 bps

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I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach

Andrea Schildbach

Learning Outcome Statements

explain the calculation and use of option-adjusted spreads;

explain how interest rate volatility affects option-adjusted spreads;

CFA® 2025 Level II Curriculum, Volume 4, Module 28.