FX swap: Difference between revisions
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* [[Swap points]] | * [[Swap points]] | ||
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Revision as of 16:10, 18 August 2014
Foreign exchange swap contract.
A short-dated composite agreement to:
1. Exchange currencies at a fixed 'near leg' date (usually spot) and price, AND
2. To re-exchange the same related currencies and amounts at a later fixed 'far leg' date and price.
The composite pricing of the FX swap is favourable for the price-taker, compared with the pricing of the two related outright contracts (for example for spot exchange and forward re-exchange of the same currency pair).
