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Credit Extinguisher

A trade that deactivates (typically with zero-recovery) if either party defaults regardless of which is in the money. It also...

Credit Exposure

Counterparty credit risk is a source of great concern for end users and dealers in the swaps market (market for...

Entropy Swap

An enhanced alternative to a variance swap. In view of the insensitivity of variance swap to the level of the...

Zero-Cost Option

An options trading strategy which is arranged such that the premium received from an option sold (short option) compensates for...

Amortizing Cap

An interest rate cap in which the successive caplets cover decreasing notional principal amounts. In other words, the notional principal...

KO Floater

It stands for knock-out floater; a barrier floater in which the coupon is deactivated (knocked-out) if the reference interest rate...

Knock-Out Floater

A barrier floater in which the coupon is deactivated (knocked-out) if the reference interest rate exceeds or falls below a...

KISS

An abbreviation for keep it simple, stupid!. The language of derivatives (such as delta, DV01, vega, gamma, notionals, vol-vol, fugit,...

KO Floating Rate Note

It stands for knock-out floating rate note; a barrier floating rate note in which the coupon is deactivated (knocked-out) if...

Knock-Out Floating Rate Note

A barrier floating rate note in which the coupon is deactivated (knocked-out) if the reference interest rate exceeds or falls...