Question: 2. The reading below deals with some typical swaption strategies and the factors that originate them. First, read it carefully. Lehman Brothers and Credit Suisse

2. The reading below deals with some typical swaption strategies and the factors that originate them. First, read it carefully.

Lehman Brothers and Credit Suisse First Boston are recommending clients to buy long-dated swaption vol ahead of the upcoming US Federal Open Markets Committee meeting. In the trade, the banks are recommending clients to buy long-dated swaption straddles, whose value increases if long-dated swaption vol rises.

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