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Which of the following statements about credit default SWAPs (CDSs) is not correct? Multiple Choice Buying a CDS is similar to buying insurance to protect
Which of the following statements about credit default SWAPs (CDSs) is not correct?
Multiple Choice
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Buying a CDS is similar to buying insurance to protect against default risk.
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Buying a CDS eliminates credit risk.
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The buyer of a CDS contract agrees to make periodic payments to the seller of the contract.
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The seller of a CDS agrees to buy a specified bond (or other instrument) from the buyer at par value in the event of a default.
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