An investor takes a view on the credit spread between say the constant maturity five year swap rate and a corporate bond. The investor pays the constant maturity rate and receives the total return on the bond (receives price appreciation and coupons, pays any price depreciation). The investor in this case believes that the spread will tighten
Today I spent the whole afternoon in meetings, then came out and penned a couple of descriptions. Phew. Time for a run now.
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