FRM: Currency swap



Brief illustration of a fixed-for-fixed currency swap (e.g., dollars for euros). Please note: in a plain vanilla interest rate swap, we referred to the NOTIONAL …

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FRM: Currency swap

Brief illustration of a fixed-for-fixed currency swap (e.g., dollars for euros). Please note: in a plain vanilla interest rate swap, we referred to the NOTIONAL because it is not exchanged (in that case, the notional is required only to compute the interest). However, in a currency swap the PRINCIPAL is exchanged. For more financial risk videos, visit our website at http://www.bionicturtle.com!