A swap in which the counterparties exchange payments based on a notional principal specified in a portfolio of stocks. It is similar to interest rate swaps in many aspects, literally: the existence of an underlying notional principal, the fixed maturity date, and the commitment to pay floating for fixed versus the commitment to pay fixed for floating.
Derivatives
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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