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Hello sir John,
The technical article on interest rate forwards to value a simple interest rate swap contract. According to it we do a FRA in order to hedge against increasing interest rates.
My question is, as we already did a FRA then why are we also using a Swap contract?
The article is not saying that they will use FRA’s in addition to doing a swap.
It is saying that it is the forward interest rates that will have been used to determine the interest rate given by the swap.