- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 28. The Term Structure and Interest Rate Dynamics
- Subject 3. The Swap Rate Curve and the Swap Spread
CFA Practice Question
Which spread reflects risk in the banking system the most accurately?
B. Ted spread
C. Z spread
A. Swap spread
B. Ted spread
C. Z spread
Correct Answer: B
An increase in the TED spread is a sign that lenders believe the risk of default on interbank loans (also known as counterparty risk) is increasing.
User Contributed Comments 0
You need to log in first to add your comment.