We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Measuring the gains from arbitraging the swap market.
- Authors
Smith, Donald J.
- Abstract
The article examines the potential benefits to companies of using interest-rate swaps. Although swaps can reduce the cost of funding on paper, whether any savings are actually realized depends on a number of factors including tax treatment, and conventions with respect to compounding and days-in-the-year assumptions. Financial executives also need to consider the presence of options within a swap, and their consequent impact on cost of funds. Considerations involving floating rate notes and credit risk are also discussed.
- Subjects
INTEREST rate swaps; SWAPS (Finance); CORPORATE finance; CORPORATE taxes; FLOATING rate notes; CREDIT risk
- Publication
Financial Executive, 1988, Vol 4, Issue 2, p46
- ISSN
0895-4186
- Publication type
Article