notional principal |
|
Definition
In interest rate swap transactions, the amount of principal of the underlying debt security. When this principal is separated from the obligation to pay interest, it becomes the notional or fictitious principal that generates the cash flow traded in the swap arrangement. Also called notional amount.
email to a friend
print this definition
cite this definition
link to this page
notional principal is in the Banking, Commerce & Finance, Disaster Planning & Risk Management, Investing and Securities & Futures Trading subjects.
notional principal appears in the definitions of the following terms: cross-currency swap, index amortizing swap, notional amount, accreting swap and amortizing swap
This content can be found on the following page:
http://www.businessdictionary.com/definition/notional-principal.html