An interest rate swap that obligates traders to enter a swap at some date in the future,with terms agreed today,is a:
A) term swap.
B) forward swap.
C) flexible swap.
D) long swap.

Question

Quizplus · Accepted Answer

A forward swap is a type of interest rate swap in which the terms are agreed upon today but the swap will not be executed until some date in the future. It is also known as a delayed-start swap or a deferred-start swap. A term swap is a type of interest rate swap that has a fixed termination date. Flexible swaps allow for changes to the terms of the swap during its life. A long swap is not a commonly used term for any type of interest rate swap.

An Interest Rate Swap That Obligates Traders to Enter a Swap