Swap1. In the exchange markets, this is a simultaneous sale of a currency on the spot market together with a purchase of the same amount on the forward market. By combining these two transactions into a single one, transactions costs may be reduced. 2. An arrangement between central banks whereby they each agree to lend their currency to the other.
SwapTraditionally the exchange of one security for another to change the maturities of a bond portfolio or the quality of the issues in a stock or bond portfolio, or because investment objectives have changed.Currency swaps involve the purchase/sale of a currency in the spot market against the simultaneous purchase/sale of the same amount of the currency in the forward market.An interest rate swap is an arrangement in which two parties agree to exchange periodic interest payments, at agreed intervals, over an agreed period, but without any principal being paid. The most common and simplest deal involves one party paying a fixed rate of interest and the other paying a floating rate.
SwapAn arrangement in which two entities lend to each other on different terms, e.g., in different currencies, and/or at different interest rates, fixed or floating.
Index swapIndex swap
A swap of a market index for some other asset, such as a stock-for-stock or debt-for-stock swap.
Debt for equity swapDebt for equity swap
A swap agreement to exchange equit../../finance-glossary/returns for debt returns or the converse over a prearranged length of time.
Equal shares swapEqual shares swap
Applies mainly to convertible securities. Selling the underlying common and reinvesting the proceeds in as much of the convertible as can be converted into the number of shares of common just sold. See equal dollar swap.
Result of stock swapResult of stock swap
A term used by the London Stock Exchange to denote that a trade was reported as a result of a stock swap or stock switch (one report is required for each line of stock swapped or switched).
Fixed for floating swapFixed for floating swap
An interest rate swap in which the fixed rate payments are traded for a floating rate.
Further SuggestionsPlain vanilla swap
interest rate swap
Swap buy back
Stock index swap
Reverse a swap
International Swap Dealers Association (ISDA)
Asset for asset swap
Equal dollar swap
Amortizing interest rate swap
Step up swap