A(n) ____ swap provides the party making the floating-rate payments with a right to terminate the swap.

Question

Quizplus · Accepted Answer

A putable swap gives the floating-rate payer the option to terminate the swap before maturity, which makes it the best fit for the given definition. A callable swap gives the floating-rate receiver the option to terminate the swap, and an extendable swap provides an option to extend the swap beyond the original maturity date. A plain vanilla swap is a standard fixed-for-floating interest rate swap without any embedded options.

A(n) ____ Swap Provides the Party Making the Floating-Rate Payments