Interest rate swaps

This topic has 1 reply, 2 voices, and was last updated 10 years ago by John Moffat.

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March 8, 2016 at 2:35 pm #304385
Robert
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John in your example 1 on interest rate swaps, could the counter parties benefit from a swap if company x wanted to borrow floating and company y wanted to borrow fixed?
If yes could you show me how to calculate it please? I can’t make it work 🙁
March 8, 2016 at 3:10 pm #304404
John Moffat
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No – they could not benefit is X wanted floating and Y wanted fixed (and so they would not enter into a swap).
A swap will only ever benefit if it is ‘one way round’ 🙂
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