ayodayo

nielsendc Wrote:
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> good call...what an idiot *shakes head in shame*
>
> So then a short payer swaption is obligating you
> to lend at a fixed rate and receive a floating
> rate should the counter party choose to exercise,
> which they would if rates went up.
>
> A long receiver swaption on the other hand gives
> you the option to receive fixed and pay floating,
> which you would exercise if rates went down.
>
> My mistake was that both are on the same side of
> the market, that is someone believing that rates
> will go down may take either position, but it was
> like saying a covered call is the same thing as
> buying a put.

*this should have read: "So then a short payer swaption is obligating you
> to lend at a fixed rate and PAY a floating rate"