Credit default swap
Credit default swap (also known by its acronym, CDS) is a derivative in which a counterparty pays if a specified debt instrument goes into default; similar to insurance on a bond.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Credit default swap (CDS). Derivative in which a counterparty pays if a specified debt instrument goes into default; similar to insurance on a bond.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
