Currency Swap

Video: 

The speaker provides a detailed overview of a currency swap.  A currency swap is created when two counterparties, who have issued two securities denominated in different currencies, exchange the principal at the outset of the swap.  This exchange is primarily governed by the exchange rate.  At some predefined interval

What is a Currency Swap?

A currency swap is an agreement between two parties to exchange a currency after a specified period of time. Maturities for currency swaps can go up to 30 years in the future. In most currency swap agreements, one party will pay a fixed interest rate, while another will pay a floating exchange rate.

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