A credit derivative whose underlying is a single-name reference entity/ asset/ issuer. Every credit derivative contract has two counterparties: a protection buyer and a protection seller (also known as the buyer and seller of the credit risk). It is also associated with a credit event which triggers, if occurs, remedial payment to the protection buyer. Otherwise, the contract will remain active until it reaches maturity date, after which it expires.
Single-name credit derivatives run the gamut from simple structures (forward contracts) to more complex ones (options, swaps, swaptions, etc). Examples include: single-name credit default forwards, single-name credit default swaps, single-name credit default swaptions, and single-name credit default options.
