Interest rate collar

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Revision as of 08:54, 1 August 2015 by imported>Doug Williamson (Align with qualifications material.)
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1.

A combination of two options used to hedge interest expense or interest income. The effect of the collar is to establish upper and lower hedged limits, within which the hedged interest expense or income is bounded.


2.

The profile of hedged interest expense or income achieved by the combination of two hedging options together with an underlying interest expense or income exposure.


See also