Derivatives
Credit Risk Spread
May 3, 2022
Jump Risk
Jump Risk
May 3, 2022

A swap in which the nominal principal increases over the life of the swap. The accreting swap is used mostly by firms willing to pay a fixed rate and receive an increasing principal. Meeting increasing working capital requirements may be one of the motives of this type of swaps. Accreting swaps are specifically popular in financing construction projects.

Accreting principal swap (APS) and set-up swap are varying names of the accreting swap

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Posts