Interest-Rate Swap

Interest-rate swap is a derivative contract exchanging interest-payment streams according to stated fixed and floating terms.

Why this matters to income investors

Swap payments can offset rate changes but also alter reported and cash earnings.

How to use interest-rate swap in your research

Check when the asset income and borrowing costs reset. A rate change can reach each side at a different time, so compare the net effect on the earnings used to fund distributions.

This material is general education and information, not individualized investment, tax, or legal advice.