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In a typical equity swap, one leg will be the cash flows that represent the total return on an equity index or on a single
In a typical equity swap, one leg will be the cash flows that represent the total return on an equity index or on a single stock. The cash flows of the other leg are usually referenced to:
- The earnings yield on the index or on the stock
- A floating rate index such as Libor
- The dividend yield on the index or on the stock
- The 30-year U.S. Treasury bond rate
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