Series 50: Important Facts About Swaps

Important Facts about Swaps

•Payments can be made on a quarterly, semiannual, or annual basis, but they are made most commonly on a semi-annual basis.

•The effective date is the date that interest payments begin to accrue, but the payment or settlement date is the date that payments are due.

•Typically, the party that owes more pays the other party only the amount of the difference (net settlement basis).

•There is no exchange of principal amounts.

•Interest is ca