Payer/Reciver Swaption remember, should, into, easily, little

noel

I'm a little lost on payer/receiver swaptions? I get them easily confused and can never apply their application correctly. i.e. when I should enter into one or the other. Any good tips to remember?

needhelp1700

payer pays fixed, receiver receive fixed.

you wanna use them to hedge your position.

eg:
if u are currently paying floating rates and are afriad that the rate gonna go up,
you enter a payer swap, so when rate does increased, you excersise option and you will pay fixed, received float.