Long / Short Position in Swap

Hmm, I normally associated the long side of a transaction as being the side that receives a certain amount of something.
 
billwest, in level 2 materials, from last year
the funny thing is that one paragraph below, they sort of say “well, although almost nobody uses this terminology”…
 
i recall seeing it in the l3 material yesterday night…that’s what got into my head anyway.
 
found on another website that long swap does appear to be opposite of other securities (i.e. bonds) and that a long swap hedges a long bond (where long swap = pay fixed)
 
F@$%! I need to find this in the curriculum. It just seems counterintuitive to me.
 
Bill.S.Preston,Esq Wrote:
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> Im going with…………
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> PAY FIXED = LONG
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> Who’s with me??
I AM
 
ditto. the entire framework of my understanding of the L3 material rests on this assumption. too late to undo it now….
 
me too
i know it’s in the curricularlum….i saw it last night!
 
It depends on your perspective. If you are paying fixed you are long the interest rate, however you are short the bond that you are hedging. Hope I didnt confuse you’ll more :)
As far as duration is considered, i think if you are receiving fixed, you are long the bond and a + ve duration. If you are paying fixed, -ve duration.
Any comments!!
 
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