Chapter 3: Swaps

In this section

• Swaps as a Series of Forward Contracts
  Swaps as a Series of Forward Contracts (CFA Level 1): Conceptualizing Swaps as a Series of Forwards, Valuation at Inception, and Ongoing Valuation and Net Settlement. Key definitions, formulas, and exam tips.
• Interest Rate Swaps
  Interest Rate Swaps (CFA Level 1): Key Concepts, Basic Mechanism of an Interest Rate Swap, and Common Market Conventions. Key definitions, formulas, and exam tips.
• Currency Swaps
  Currency Swaps (CFA Level 1): Understanding the Mechanics of a Currency Swap, Why Currency Swaps Are Used, and Visualizing the Payment Flows. Key definitions, formulas, and exam tips.
• Equity and Commodity Swaps
  Equity and Commodity Swaps (CFA Level 1): Equity Swaps: Key Concepts, Structure of an Equity Swap, and Rationale for Using Equity Swaps. Key definitions, formulas, and exam tips.
• Valuation of Swaps at Initiation and During the Contract
  Valuation of Swaps at Initiation and During the Contract (CFA Level 1): Key Concepts, Why Value a Swap?, and Valuation at Initiation. Key definitions, formulas, and exam tips.
• Swap Termination and Novation
  Swap Termination and Novation (CFA Level 1): Key Methods of Early Termination, Close-Out/Termination Payment, and Offsetting Swap. Key definitions, formulas, and exam tips.
• Interest Rate Caps, Floors, and Swaptions
  Interest Rate Caps, Floors, and Swaptions (CFA Level 1): Key Concepts in Interest Rate Caps, Mechanics of a Cap, and Typical Users. Key definitions, formulas, and exam tips.
• Freight and Commodity Swaps
  Freight and Commodity Swaps (CFA Level 1): Freight Swaps: A Deeper Dive, Market Participants, and Freight Rate Indices. Key definitions, formulas, and exam tips.
• Asset Swaps and Applications
  Asset Swaps and Applications (CFA Level 1): Conceptual Foundations, Mechanics in Brief, and How Asset Swaps Work. Key definitions, formulas, and exam tips.
• Weather and Catastrophe Swaps
  Weather and Catastrophe Swaps (CFA Level 1): Understanding Weather Swaps and Key Features of Weather Swaps. Exam-focused explanations with key terms and takeaways.
• Political Risk Swaps
  Political Risk Swaps (CFA Level 1): political risk swap differs from a standard, Which of the following is a challenge in, and In a political risk swap, the “protection buyer”. Key definitions, formulas, and exam tips.
• Inflation Swaps
  Inflation Swaps (CFA Level 1): Basic Mechanics of Inflation Swaps, Key Elements, and Comparing Inflation Swaps to Interest Rate Swaps. Key definitions, formulas, and exam tips.
• Intra-Curve and Inter-Curve Swap Spreads
  Intra-Curve and Inter-Curve Swap Spreads (CFA Level 1): Defining Intra-Curve Swap Spreads, Typical Intra-Curve Spread Formula, and Defining Inter-Curve Swap Spreads. Key definitions, formulas, and exam tips.
• Multi-Lateral Swap Compression Techniques
  Multi-Lateral Swap Compression Techniques (CFA Level 1): Understanding the Basics of Multi-Lateral Swap Compression, Mechanism of Multi-Lateral Compression, and Diagram: Multi-Lateral Compression Flow. Key definitions, formulas, and exam tips.
• Forward Start and Accreting Swaps
  Forward Start and Accreting Swaps (CFA Level 1): Forward Start Swaps, Defining a Forward Start Swap, and How They Are Used. Key definitions, formulas, and exam tips.
• Futurization of Swaps and Swap Futures
  Futurization of Swaps and Swap Futures (CFA Level 1): Key Drivers Behind Futurization, What Swap Futures Are—and Are Not, and Deliverable vs. Non-Deliverable Swap Futures. Key definitions, formulas, and exam tips.
• Funded vs. Unfunded Swap Structures
  Funded vs. Unfunded Swap Structures (CFA Level 1): Test Your Understanding: Funded vs. Unfunded Swap Structures and In a funded swap, what typically happens at. Key definitions, formulas, and exam tips.