1.FOREWORD…………………………………………………………………………………………………………………………………4
2.INTRODUCTION…………………………………………………………………………………………………………………………..5
3.MARKET OVERVIEW…………………………………………………………………………………………………………………….7
4. PARTICIPANTS………………………….………………………………………………………………………………………………..8
5. TYPES OF CREDIT DERIVATIVES…..………………………………………………………………………………………………9
6. CREDIT RISK………………………………..……………………………………………………………..…………………………….13
7. CREDIT disregard SWAP (CDS) AND THEIR USE…….……………………………..………….………………………….14
8. MARKET VALUES OF CDS………….…………………………………………………………………….………………………...15
9. CONCENTRATION…………………………………….…………………………………………………….…………………………17
10. engagement SELLERS OF PROTECTION………………………..………………………………………………..………………………20
11. INTERCONNECTEDNESS………………………………………………………………………………….………………….……21
12. RISK CIRCULARITY……………………………………………………………………………………...…………………………..22
13. SOVEREIGN address ENTITIES AND WRONG-WAY RISK …….…………………………………………………22
14. CONCLUSIONS……………………………………………………………………….………………………………………………..24
15. ASSET SWAPS
15.1 Description………………………………………………………………………………………………………………..24
15.
2 Pricing aspects…………………………………………………………………………………………………..………25
15.3 Calculation of the summation swap spread…………………………………………………………….……………27
15.4 Applications……………………………………………………………………………………………………………….28
16. BIBLIOGRAPHY………………………………………………………………………………..………………………………………29
FOREWORD
The credit derivatives food market has revolutionized the transfer of credit risk. Its impact has been borne out by its significant growth which has before long achieved a market notional close to $2 trillion. temporary hookup not directly comparable, it is worth noting that the total notional heavy(p) of global investment grade corporate bond exit currently stands at $3.1 trillion.
This growth in the credit derivatives market has been driven by an increasing realization of the advantages credit derivatives own over the cash alternative, plus the...If you want to get a full essay, order it on our website: Orderessay
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