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Basic Question 4 of 9

In a CDS, the protection seller essentially takes the default risk of lending:

A. directly to the protection buyer.
B. directly to the reference entity.
C. to nobody. That is, the seller is exposed to no default risk.

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You have a wonderful website and definitely should take some credit for your members' outstanding grades.
Colin Sampaleanu

Colin Sampaleanu

Learning Outcome Statements

describe credit default swaps (CDS), single-name and index CDS, and the parameters that define a given CDS product;

CFA® 2025 Level II Curriculum, Volume 4, Module 30.