Which of the following is a source of profit for a swap dealer?
A) Commission charged on the sale of bonds
B) Bid-ask spread
C) Margin account
D) Option premium

Question

Quizplus · Accepted Answer

Swap dealers make money by profiting from the bid-ask spread, which is the difference between the price at which they buy and sell a swap. Commission charged on the sale of bonds, margin account, and option premium are not sources of profit for a swap dealer.

Which of the Following Is a Source of Profit for a Swap