Hedging Strategies
Strategic guides and analysis on interest rate hedging approaches including caps, swaps, collars, and other instruments for commercial real estate portfolios.
What Strike to Buy
The age-old question!
Hybrid Hedging Strategies - Something to Consider
Balancing risk and protection off today's rate expectations.
Hedging Falling Rates
Falling rates is generally good news for CRE borrowers, but have you considered where you might be exposed as the Fed begins cutting rates?
Replacement Hedge Strategies - Part Two
Part two of this resource focuses on borrowers with bank debt where the bank has the ability to offer swaps and other derivatives.
Replacement Hedge Strategies - Part One
Many borrowers with upcoming hedge maturities wonder if there are alternatives to a vanilla cap that they should consider.
Cut Cap Escrows in Half
Borrowers who extend their interest rate caps early, or purchase extensions longer than the minimum term, can cut their monthly escrows in half.
Buying a Cap Below the Floor? Learn About the Flooridor
Looking to lower your rate? Some commercial real estate borrowers have done this by purchasing an interest rate cap strike below where floating rates are going.
The Capped Corridor - An Alternative to the Vanilla Interest Rate Cap
Looking to calculate the effective rate for commercial real estate when SOFR is above the sold strike? We walk you through examples to better explain SOFR.
Market Volatility & What To Do With a Worthless Cap
A primary driver of increases in cap costs has been the sharp climb in market volatility, especially in commercial real estate.
Hedging Prime
Unlike LIBOR, there are no Prime futures. Many banks won’t provide hedges based on Prime. Traders usually charge premiums for the risk between LIBOR & Prime
Corridors For Dummies
Corridors are frequently confused with their more common cousin, collars. Unlike collars (cap & floor), corridors are just two caps – one bought and one sold.