equity swaps

An equity swap is a financial agreement where two parties exchange the returns from their respective investments. Typically, one party pays returns based on a specific stock or stock index (like dividends and capital gains), while the other pays a fixed or floating interest rate on a principal amount. This allows investors to gain exposure to the stock market without actually owning the stocks. Equity swaps can help with risk management, tax optimization, or leveraging investment strategies. Essentially, it's a way for investors to bet on the performance of equities while managing their own portfolios' risk.