A swap which allows one of the counterparties to lock in the spread between two different points on a particular yield curve. The counterparty willing to lock in the spread can trigger it at any time during a preset trigger or lock-in period. This swap is mainly used to speculate on future curve movements or to benefit from a favorable curve setting when the absolute level of the underlying market makes entering into a swap a lackluster or a scathing choice.

It is also called a trigger swap.