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Swaption
An option contract whose underlying is an interest rate swap.
The payer swaption can be distinguished from the receiver swaption depending on whether the buyer acquires, in exchange for a premium, the right to enter into a swap at or until a specified date as a fixed-rate payer or a fixed-rate receiver at a predetermined exercise rate in exchange for floating-rate payments.
Translations
Synonyms and variations
- Swap option