A portfolio of forward contracts. A swap is almost identical to a sequence of forward contracts (commitment to buy (long) or sell (short) an underlying asset at a prespecified price and time}, and its close relative the future, at different maturity dates. One of the advantages of swaps is that a market maker can tailor a swap to fit the needs of a particular counterparty, whereas standardization is the key to the success of exchange-traded instruments.
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