Which of the following statements is correct when comparing the
differences
between an interest rate swap and a currency swap?
Question options:
|
|||
|
|||
|
|||
|
|||
|
SWAP is a forward contract between two parties to exchange their Currency and interest rate accoring to their convenience. During life of swap each parties exchnage their interest rate and pays interest according to other parties rate. But At maturity, there is no exchange of principal between the counterparties in interest rate swaps and there is an exchange of principal in currency swaps.
Also, At maturity, there is no exchange of principal between the counterpartiesin currency swaps and there is an exchange of principle in interest rate swaps..
Option (1) and (2) is correct answer.
Get Answers For Free
Most questions answered within 1 hours.