Difference between revisions of "Collateral swap"

From MarketsWiki
Jump to: navigation, search
(Created page with "A collateral swap refers to the lending of liquid assets, such as top-rated government bonds, to another, in return for the receipt of less liquid collateral.<ref>{{cite web|url=...")
 
Line 1: Line 1:
A collateral swap refers to the lending of liquid assets, such as top-rated government bonds, to another, in return for the receipt of less liquid collateral.<ref>{{cite web|url=http://www.ft.com/intl/cms/s/0/e4109c9c-a31f-11e0-a9a4-00144feabdc0.html|name=Concern mounts over rise of collateral swaps|org=Financial Times|date=May 18, 2012}}</ref> The borrower of the liquid funds pays a fee to the lender to compensate for the risk of holding a less liquid asset.
+
A collateral swap refers to the lending of [[liquid]] [[assets]], such as top-rated [[government bonds]], to another, in return for the receipt of less liquid collateral.<ref>{{cite web|url=http://www.ft.com/intl/cms/s/0/e4109c9c-a31f-11e0-a9a4-00144feabdc0.html|name=Concern mounts over rise of collateral swaps|org=Financial Times|date=May 18, 2012}}</ref> The borrower of the liquid funds pays a fee to the lender to compensate for the risk of holding a less liquid asset.
  
 
      
 
      
 
== References ==
 
== References ==
 
<references />
 
<references />

Revision as of 05:23, 2 July 2013

A collateral swap refers to the lending of liquid assets, such as top-rated government bonds, to another, in return for the receipt of less liquid collateral.[1] The borrower of the liquid funds pays a fee to the lender to compensate for the risk of holding a less liquid asset.


References

  1. Concern mounts over rise of collateral swaps. Financial Times.