Quarterly bank OCC report: Total Swaps jumped by $10T of nominal value in 2021 after being flat for the last 5 years. GS still leveraged 136:1 on their nominal derivatives, but was reduced. Top 5 increased their swaps by ~$1T each. Top 4 added $200B in short term Equity Derivatives alone.

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by laflammaster

Swaps are a type of contract, where you make a bet that the underlying security would go down.

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Swap type depends on the type of security you are looking to “bet against”.

There are multiple types of swaps:

  • Interest Rate Swaps
  • Commodity Swaps
  • Zero Coupo Swaps
  • Currency Swaps
  • Credit Default Swaps
  • Total Return Swaps

Each of those types of swaps may cover specific sets of securities, although some can overlap (need to confirm).

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Total Return Swaps gives an investor the benefits of owning securities, without actual ownership. www.investopedia.com/articles/investing/052915/different-types-swaps.asp#credit-default-swaps

Within those securities, equities represent a subset (portion) of total value.

So, in dollar value:

Total Swaps > Total Return Swaps > Total Equity Return Swaps.

 

 

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