Explain how a fixed-for-floating swap can be considered a
1. Why is a call option on an interest rate called an interest rate cap and a put option called an interest rate floor?
2. Explain how a fixed-for-floating swap can be considered a portfolio of forward contracts on six-month discount bonds.
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1 why is a call option on an interest rate called an interest rate cap and a put option called an interest rate floor2
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