Why is notional principal often exchanged in a currency swap

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Reference no: EM131325717

1 .Why is notional principal often exchanged in a currency swap but not in an interest rate or equity swap? Why would the parties to a currency swap choose not to exchange the notional principal ?

2 .Explain how the following types of swaps are analogous to transactions in bonds.

a. Interest rate swaps

b. Currency swaps.

Reference no: EM131325717

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