age of over-the-counter products such as swaps or forwards contracts, relative to exchange-traded products such as options or futures, is: a. regulation. b. standardisation. c. flexibility. d.

Q: One main assumption of the segmented markets theory is that: Select one: O A. Bonds of different…

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Q: define and explain convenience yield, and describe how it is incorporated into the futures pricing…

A: “Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first…

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Swaps

A swap is a derivative contract in which two parties are agreed to exchange their cash flows from two different financial instruments for a defined period. In swap contracts, cash flows from one financial instrument are fixed and cash flow from other financial instruments is variable based on the interest rate, exchange rate, and commodity price. Swap contracts are transacted in an over-the-counter system. Swap contracts are utilized to hedge risk and mitigate loss.