Sovereign CDS Buyers Don’t Necessarily Expect Default

19 Jan 2010

It is a “widespread misconception” that buying sovereign credit default swaps means investors are expecting a country to default, according to two U.K. credit derivatives experts.

It is a “widespread misconception” that buying sovereign credit default swaps means investors are expecting a country to default, according to two U.K. credit derivatives experts. In a letter to Financial Times, John Eatwell of Queens’ College and Robert Reoch of New College Capital said the correlation often ...

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