A swap counterparty that pays out a fixed rate and collects a floating rate is said to be in a _______ position.
A) Hedged
B) Short
C) Straddled
D) Long
E) None of the above

Question

Quizplus · Accepted Answer

A swap counterparty that pays out a fixed rate and collects a floating rate is said to be in a long position, similar to being long in a fixed-rate bond where they benefit from falling interest rates.

A Swap Counterparty That Pays Out a Fixed Rate and Collects