Difference between revisions of "CDS options"

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Credit default swap options (or "credit swaptions") are options to buy or sell credit default swaps on single name stocks or traded indices.
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Credit default swap options (or "credit swaptions") are options to buy or sell credit default swaps on single name stocks or traded indices.<ref>{{cite web|url=http://findarticles.com/p/articles/mi_m0EIN/is_2005_March_21/ai_n13455223/|name=Fitch Survey: Credit Default Swap CDS —Options: What They Are, Who Is Using Them, and Why|org=bnet|date=June 10, 2010}}</ref>
  
 
CDS index options are traded off the two main families of CDS indexes -- the U.S.-based CDX and the European-based iTraxx.  They work like U.S. equity index options. They provide users with the right to buy or sell protection at a specified time and spread level off the CDS indices.<ref>{{cite web|url=http://www.marketwatch.com/story/options-in-an-increasingly-volatile-market-2010-06-09?dist=countdown|name=Despite reform, CDS options go from toxic to tasty|org=Marketwatch|date=June 10, 2010}}</ref>
 
CDS index options are traded off the two main families of CDS indexes -- the U.S.-based CDX and the European-based iTraxx.  They work like U.S. equity index options. They provide users with the right to buy or sell protection at a specified time and spread level off the CDS indices.<ref>{{cite web|url=http://www.marketwatch.com/story/options-in-an-increasingly-volatile-market-2010-06-09?dist=countdown|name=Despite reform, CDS options go from toxic to tasty|org=Marketwatch|date=June 10, 2010}}</ref>

Revision as of 15:32, 10 June 2010


Credit default swap options (or "credit swaptions") are options to buy or sell credit default swaps on single name stocks or traded indices.[1]

CDS index options are traded off the two main families of CDS indexes -- the U.S.-based CDX and the European-based iTraxx. They work like U.S. equity index options. They provide users with the right to buy or sell protection at a specified time and spread level off the CDS indices.[2]


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References

  1. Fitch Survey: Credit Default Swap CDS —Options: What They Are, Who Is Using Them, and Why. bnet.
  2. Despite reform, CDS options go from toxic to tasty. Marketwatch.