Interest rate swap 1 | Finance & Capital Markets | Khan Academy
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- Опубликовано: 15 сен 2011
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The basic dynamic of an interest rate swap. Created by Sal Khan.
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Finance and capital markets on Khan Academy: Interest is the basis of modern capital markets. Depending on whether you are lending or borrowing, it can be viewed as a return on an asset (lending) or the cost of capital (borrowing). This tutorial gives an introduction to this fundamental concept, including what it means to compound. It also gives a rule of thumb that might make it easy to do some rough interest calculations in your head.
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Okay seriously this guy is way better at explaining things then my teacher. It's me 3 minutes to get it here, and takes my teacher 2 hours.
Your teacher has to justify the 2 hours of his work, that's why it takes 2 hours.
I was studying for exam FM via coaching actuaries and needed clarification on this topic. This cleared it up! Thanks Khan!
Thank you Sir ! You deserve more than just a comment for this wonderful presentation !
way clearer than my course material, thanks a lot
I love ya Sal! you're a fantastic teacher
Thank you so much for the video. Much appreciated.
That explanation is the best explanation on this topic I ever had.
hey it's 10 years from the videos was posted but this helps me a lot, thank you so much!
I am asking a very basic question but after period 1, (@0.56), you would have lesser beginning balance after the interest payment right, so shouldnt the Period 2 payment be slightly lesser than 60k? Is interest payment based on the beginning balance or the notional amount?
Great! Helps me a lot
Thanks for your help!
Simply Brilliant explanation!
thanks for the amazing explanation
Learnt so much from you. Wish i came across this channel earlier. Amazing explanation from back of the day ❤👏.
Hi Khan
Would you mind to share some idea about CNY repo IRS ?
Thanks
thank you !
Thanks helped me a lot... 😊😊 Keep making such videos.. 👍👍
Most likely, Company A has weak or poor credit ratings, hence, banks will issue floating interest rate for Company A.
thanks a lot Salman Khan 😊
Thanking you from Ireland
Thank you so much the crispy serious master!
Thank you sir, it's clear now.
Nicely explained.
i never comment but credit where credits due ive got a final year uni exam in 12h and this guys saving my life rn
Super thanks @khan academy🎉
You made it too easy to understand
Well explained
very helpful :)
i love your handwriting sal
No one does it like sal!
My teacher told me about your channel. Plus when she said "Khan" I was like: :O
My middle name is also Khan so yeah...
Superbb....
you never explained where the 7% or Libor + 1% came from, where is the quality spread differential?
I do not understand why they can't just refinance, and how can the borrower set up an agreement without the lenders' agreement? Thanks!
Great
I get how it works but why on earth would they do it??
Often it means that a lender can get a better rate than their own bank is offering.
it's hard to sol.??
sometimes I watch your videos to listen to your voice......
What if the floating rate increases the next year? Will they still follow the same arrangement?
yes
Yes and A will be happy as their payments to B won’t increase whereas B will be paying more to A.
here what i don't get, why would company A take out a variable rate if it doesnt like a variable rate just to swap it with another company?
Maybe company A is a riskier company and the a variable rate loan is all they could qualify for?
@@friday5757 Yup, or maybe they fell under hard times and lost cashflow so having variable rates makes them nervous
So for company A to take the 7 from Company B’s 8% loan, what happens to the remaining 1%?
Company B will pay off the rest.
i love you
It seems a system error decided to send the transaction to an invalid email.
Consider a 6 month OIS
Notional Price = INR 200
Fixed Rate = 7.5%
Floating Rate = NSE Overnight MIBOR
Under the structure of the swap, the Fixed Rate is nominal rate,
MIBOR is compounded daily (on holidays the previous MIBOR is taken)
Consider 182 days in the period of SWAP, 365 days in a year
MIBOR remains constant for the entire period at 6.90%
What is the amt to be exchanged at the end?
Answer is INR 0.479 (Can you show the calculation for it)
In which course does this matter come in?
you lost me at libor...
London Interbank Offering Rate is an average of the 16 banks in EU and averages them into the LIBOR.
Company B is agreeing to pay Company A a variable rate?
Company A already has a variable rate...I don't get it?
Yes same with me too. Can anyone explain this?
Behold, a system error has caused the transaction to venture to an invalid email address.
IIBOR is dead!!!!