v.
intr. To trade one thing for another. v.
tr. To exchange (one thing) for another. n.
An exchange of one thing for another.
A contract in which two parties agree to exchange periodic interest payments, especially when one payment is at a fixed rate and the other varies according to the performance of a reference rate, such as the prime rate.
[Middle English swappen, to strike, strike the hands together in closing a bargain.] swap'per n.
c.1300, "to strike, strike the hands together," possibly imitative of the sound of hitting. The sense of "exchange, barter, trade" is first recorded 1594, possibly from the practice of slapping hands together as a sign of agreement in bargaining. The noun in this sense is attested from 1625.
Main Entry: swap Pronunciation: 'swäp Function: noun 1: an exchange of securities 2: a derivative contract in which two parties (as corporations) agree to exchange rates esp. relating to debt