Type of swaps in which fixed payments of interest are exchanged by two counterparties for floating payments of interest are called

Type of swaps in which fixed payments of interest are exchanged by two counterparties for floating payments of interest are called interest rate swaps. An interest rate swap is a type of a derivative contract through which two counterparties agree to exchange one stream of future interest payments for another, based on a specified principal amount. In most cases, interest rate swaps include the exchange of a fixed interest rate for a floating rate.