medium · Debt Capital Markets pricing-yields-curve
Which of the following describes the 'Dual-Curve' discounting framework adopted by market participants following the 2008 financial crisis?
- Projecting floating rates using the index curve and discounting at the OIS rate
- Applying a single constant 50 bps spread to every projected forward rate
- Discounting all future cash flows at LIBOR while projecting them on the SOFR curve
- Using Treasury rates for both projection and discounting to strip out all embedded credit risk
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