Loading...
CFA Level 3
Derivatives & Currency Mgmt

Identifying the Correct Interest Rate Swap Strategy

Very Easy Derivative Strategies Swap Strategies

John is a financial manager at a company that occasionally receives fixed interest payments and pays floating interest payments. He is considering using a swap strategy to manage interest rate risk more effectively. Understanding the distinct types of interest rate swaps will help him implement a more efficient strategy.

Which type of interest rate swap would primarily allow John to convert his floating interest payments to fixed payments and stabilize his interest expenses?

Hint

Submitted3.7K
Correct3.1K
% Correct83%