Swapping
/ˈswɒpɪŋ/
Definitions
- (n.) A financial arrangement in which two parties exchange streams of cash flows or liabilities according to predetermined terms.
The companies entered into an interest rate swapping agreement to manage their exposure.
- (v.) The act of exchanging assets, securities, or contractual rights between parties under a swapping agreement.
They are swapping debt obligations to alter their risk profiles.
Related terms
See also
Commentary
In legal drafting, clearly define the terms and conditions of a swapping contract to avoid ambiguity in rights and obligations.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.