Which of the following is the typical way an asset manager employs interest rate swaps in subprime securitized pools?
　　A. Short-term, pay fixed swap.
　　B. Long-term, receive fixed swap.
　　C. Long-term, pay fixed swap.
　　D. Short-term, receive fixed swap.
　　Answer:B
　　First, the fixed portion of subprime hybrid loans are short-term, typically 2 to 3 years. The floating portion is long-term. Second, the bank reduces its exposure to a floating rate inflow (asset) by entering into a pay-floating, receive-fixed swap.