Which of the following statements about constant maturity swaps is not true?
A)the CMT rate is linked to a U.S.treasury security of equivalent maturity
B)the typical maturity is 2 to 5 years
C)the maturity is constant
D)one rate is based on a security of a longer rate than the settlement period
E)the swap is a type of interest rate swap

Question

Quizplus · Accepted Answer

Constant maturity swaps (CMS) do not have a constant maturity; instead, they reference the yield of a fixed maturity instrument, such as a 10-year Treasury note, throughout the life of the swap. The maturity of the swap itself can vary.

Which of the Following Statements About Constant Maturity Swaps Is