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Amortizing Swap


An interest rate swap whose notional principal amount (NPA) declines over its life according to a specific amortization schedule. The declining amount reflects the amortization of the principal at an underlying fixed or floating rate. At maturity, the notional principal amount drops to zero while the swap expires.

Amortizing swaps are widely used for amortizing loans, lease finance, etc.



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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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