Aa E. 6. Other types of derivatives Aa There are several different types of derivative securities including forwards, futures, swaps, inverse floaters, and structured notes. These securities may be used to manage the risks of business organizations or to speculate on certain market events. Consider the descriptions or characteristics in the following table and indicate the type of derivative to which each corresponds: Type of Derivative Description or Characteristic This type of debt security has a coupon that decreases when interest rates increase, and vice versa. This type of derivative security is intended to eliminate exchange rate risk and involves counterparties that exchange the principal and interest payments of the loan in one currency for the equal discounted value of a counterparty's loan in another currency This type of security is backed or collateralized by another debt security and may take the form of a zero coupon security or may receive periodic interest payments The most common form of this type of derivative involves counterparty A making a fixed-rate interest payment to counterparty B while receiving a floating-rate interest payment from the counterparty, and vice versa