Fixed term loan and Fixing: Difference between pages
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1. The setting of an interest rate for a predetermined future period. For example, the periodic re-setting of the interest rate on a floating rate loan. | |||
2. The use of derivative instruments such as Fixed rate agreements (FRAs) for hedging purposes, to effectively fix a hedged rate. | |||
3. A fixing instrument (or fixing derivative) is one which hedges an exposure by effectively fixing a hedged rate for it. Contrasted with an insurance-type instrument, such as an option. | |||
== See also == | == See also == | ||
* [[ | * [[Fixing instrument]] | ||
* [[ | * [[Forward rate agreement]] | ||
* [[Option]] | |||
Revision as of 14:19, 23 October 2012
1. The setting of an interest rate for a predetermined future period. For example, the periodic re-setting of the interest rate on a floating rate loan.
2. The use of derivative instruments such as Fixed rate agreements (FRAs) for hedging purposes, to effectively fix a hedged rate.
3. A fixing instrument (or fixing derivative) is one which hedges an exposure by effectively fixing a hedged rate for it. Contrasted with an insurance-type instrument, such as an option.
See also
