The reference entity in a credit default swap is
A)The buyer of protection
B)The seller of protection
C)The company or country whose default is being insured against
D)None of the above

Question

Quizplus · Accepted Answer

In a credit default swap the buyer of protection pays a CDS spread to the seller of protection and the protection seller has to make a payoff if there is a default by the reference entity.

The Reference Entity in a Credit Default Swap Is