A floating-for-fixed currency swap is equivalent to
A) Two interest rate swaps, one in each currency
B) A fixed-for-fixed currency swap and one interest rate swap
C) A fixed-for-fixed currency swap and two interest rate swaps, one in each currency
D) None of the above

Question

Quizplus · Accepted Answer

A floating-for-fixed currency swap where the floating rate is paid in currency X and the fixed rate is received in currency Y is equivalent to (a)a fixed-for-fixed currency swap where,say,5% in currency X is paid and the fixed rate in currency Y is received,(b)a regular interest rate swap where 5% in currency X is received and floating in currency X is paid.

A Floating-For-Fixed Currency Swap Is Equivalent to