# Swap

*Derivatives & Options — Finicade finance glossary*

A contract to exchange two streams of cash flows — classically, swapping a floating interest rate for a fixed one. Companies use swaps to turn unpredictable payments into predictable ones without touching the underlying loan.

**Also known as:** swaps

**Related terms:** [Derivative](https://finicade.com/glossary/derivative), [Hedging](https://finicade.com/glossary/hedging), [Interest Rate](https://finicade.com/glossary/interest-rate)

**Taught in:** Charter Climb — Derivatives: Options & Swaps

Source: https://finicade.com/glossary/swap