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Derivatives




Monetizing Equity Swap


A swap that entails the exchange of the cash flows on a position in restricted stock or concentrated equity for the payment of cash flows associated with a different asset or a diversified index. The combination of an equity position and an equity swap is economically equivalent to the sale of the equity position and the reinvestment of sale proceeds in another asset. Meanwhile, the investor can retain equity holdings and associated voting rights.



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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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