Multiple Choice
You have entered into a swap where you receive the fixed rate and pay the floating rate. What is the best way to hedge interest-rate risk in this swap from among the following choices?
A) Add a long position in fixed rate bonds.
B) Add a short position in interest-rate futures.
C) Add a basis (i.e., floating-floating) swap.
D) Add a short position in FRAs.
Correct Answer:
Verified
Correct Answer:
Verified
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