A bank has a bilateral uncollateralized transaction with a client and an offsetting transaction with a dealer that is cleared through a central clearing counterparty.

Which of the following statements are true about the margin valuation adjustment (MVA)?

Check all that apply:

MVA is greater than zero.

The transaction with the dealer increases MVA.

Investments in initial and variation margin are high risk.

The transaction with the client increases MVA.

(this is a multiple choice question**)