X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

financial graphsCredit Default Swaps (CDS) are instruments that enable holders of bonds and loans to hedge their credit risk by purchasing protection against a default by the issuer/borrower on such instruments, and to enable investors that do not hold the underlying debt instruments to make bets on the likelihood of such defaults.

The inherent conflict between sellers and buyers of CDS protection becomes more marked when a CDS protection buyer is either not exposed to the underlying debt, is “net-short” by virtue of holding a greater amount of CDS protection than its exposure to the underlying debt, or has acquired its position at a significant discount. In all of these instances, the CDS protection buyer stands to profit if a CDS credit event occurs.

This premium content is locked for
New York Law Journal subscribers only.

*May exclude premium content
Already have an account?
Interested in customizing your subscription with Law.com All Access?
Contact our Sales Professionals at 1-855-808-4530 or send an email to groupsales@alm.com to learn more.

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2019 ALM Media Properties, LLC. All Rights Reserved.