Swaps
A financial swap is an agreement to exchange cash flows in the future at a pre-arranged formula. In a NYMEX swap, parties exchange payments based on changes in the price of a commodity or a market index, while fixing the price they effectively pay OR RECEIVE for the physical commodity. The transaction enables each party to manage exposure to commodity prices or index values. Settlements are made in cash into the customer's NYMEX clearing account. Most NYMEX swaps are cleared via the NYMEX Clearport system.