Swaps 101
6 Questions
1 Views

Swaps 101

Created by
@FabulousWaterfall

Questions and Answers

What is a swap?

  • A fixed cashflow agreement between two counterparties (correct)
  • A loan agreement between two parties
  • A type of stock exchange
  • A type of insurance contract
  • What is a swap?

  • A type of stock that pays a variable dividend
  • A type of bond that pays a fixed interest rate
  • A contract between a buyer and a seller for the purchase of goods
  • An agreement between two counterparties to exchange cashflows at fixed intervals (correct)
  • What is the underlying asset of a swap?

  • A bond (correct)
  • A commodity
  • A real estate property
  • A stock
  • What is the underlying asset of a swap typically?

    <p>A debt instrument or a foreign currency</p> Signup and view all the answers

    What is a limitation of the swaps market?

    <p>It is virtually limited to large corporations and financial institutions</p> Signup and view all the answers

    What are some limitations of the swaps market?

    <p>Illiquidity and difficulty in finding a counterparty</p> Signup and view all the answers

    Study Notes

    Studying That Suits You

    Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

    Quiz Team

    Description

    "Test Your Knowledge on Swaps: Understanding the Mechanics and Benefits of Cashflow Agreements" - Take this quiz to enhance your understanding of swaps and learn how these agreements work. From fixed periodic intervals to uncertain cashflow streams, this quiz covers key concepts and benefits that make swaps an important financial tool. Get ready to ace your next financial exam or impress your colleagues with your knowledge of swaps!

    Use Quizgecko on...
    Browser
    Browser