Which of the following is true?
A)OIS rates are less than the corresponding LIBOR rates
B)OIS rates are greater than corresponding LIBOR rates
C)OIS rates are sometimes greater and sometimes less than LIBOR rates
D)OIS rates are equivalent to one-day LIBOR rates

Question

Quizplus · Accepted Answer

OIS (Overnight Indexed Swap) rates are generally lower than LIBOR (London Interbank Offered Rate) rates because OIS rates are based on overnight rates, which are typically lower due to their shorter duration and lower credit risk compared to the term rates used in LIBOR.

Which of the Following Is True