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Basic Question 2 of 9
The cheapest-to-deliver option benefits the ______.
B. protection seller.
C. loan borrower.
A. protection buyer.
B. protection seller.
C. loan borrower.
User Contributed Comments 3
| User | Comment |
|---|---|
| gregsob2 | really? in what sense? isnt it the protection seller who delivers the bond? |
| droko | the buyer delivers. |
| CFAJ | the protection seller either buys the defaulted bonds from the buyer of CDS or pays the difference between cheapest to deliver and notional amount |
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Learning Outcome Statements
describe credit default swaps (CDS), single-name and index CDS, and the parameters that define a given CDS product;
CFA® 2025 Level II Curriculum, Volume 4, Module 30.