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Derivatives




Swap Face Value


The face value of a swap is its notional principal amount; it is the nominal value that is used as a basis for calculating swap payments. A respective period’s rate (resetting rates for resetting periods) is multiplied by the notional amount to determine the amount of payment that a counterparty has to make to the other.

The swap face value never changes hands in a transaction, as it is only used for payment calculation.



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Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
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