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imported>Doug Williamson |
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| (IRS). A longer-term interest rate derivative.
| | Long Term Foreign Exchange. |
| An IRS is similar in its effect to a Forward Rate Agreement (FRA).
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| An IRS - like an FRA - is a contract for differences based on an agreed market interest rate.
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| But the IRS usually has multiple future interest calculation and settlement dates, and is used by a corporate to hedge or transform longer term interest rate exposures.
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| For example, an interest rate swap might be used to transform a longer term floating rate borrowing into a synthetic fixed rate borrowing.
| | =See also= |
| | | * [[Long term foreign exchange]] |
| (Whereas an FRA is for the shorter term and for a single settlement receipt or payment.)
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| Other forms of capital market swap have been developed for the exchange of many other different types of cash flows and are used widely to hedge or transform a wide variety of related underlying exposures.
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| == See also ==
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| * [[Accreting swap]] | |
| * [[Amortising swap]]
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| * [[Cross-currency interest rate swap]]
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| * [[Forward rate agreement]]
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| * [[Forward start swap]]
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| * [[Notional amount]]
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| * [[Swap]]
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| * [[Swap rate]]
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| | [[Category:Manage_risks]] |
Latest revision as of 10:03, 26 November 2014
Long Term Foreign Exchange.
See also