- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 30. Credit Default Swaps
- Subject 3. Basics of Valuation and Pricing
CFA Practice Question
If a company's credit spread widens during the life of a CDS, which party will benefit?
B. protection seller.
C. neither, as the upfront premium has been paid.
A. protection buyer.
B. protection seller.
C. neither, as the upfront premium has been paid.
Correct Answer: A
The protection buyer owns the protection.
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