What Is an Interest Rate Swap Valuation?

Swap refers to buying spot foreign exchange in the foreign exchange market and selling forward foreign exchange of the same currency, or selling spot foreign exchange and buying forward foreign exchange of the same currency, that is, in the same In a transaction, a spot and forward business are combined together, or a lending business is combined together in a business. In swap transactions, the difference between the spot exchange rate and the forward exchange rate, that is, the premium or discount is called the swap rate.

Swap

In 1981, IBM and the World Bank

include

Sterling

The so-called swap transaction refers to selling or buying forward foreign exchange of the same currency at the same time as buying or selling spot foreign exchange to prevent

(1) Buying and selling are consciously performed simultaneously

(2) Buy and sell the same currency and the same amount

(3) Trading

Spot-to-forward swap

Immediate vs. forward

Facilitates hedging by importers and exporters

For example, UK exporters and the U.S.

Swap protection refers to the simultaneous purchase or sale of spot foreign exchange in one currency, and the sale or purchase of forward foreign exchange in the same currency; or the purchase or sale of spot foreign exchange in a recent period At the same time, sell or buy forward foreign exchange for a longer period of the same currency.