I feel i have a decent grasp on this material but was hoping someone could clarify or provide some additional context to the following:

“At initiation of the swap, the fixed rate is selected so that the PV of the floating-rate payments is equal to the PV of the fixed-rate payments, which means the swap value is zero to both parties”

I understand this is an underlying concept to not just swaps, but also forwards and futures…ha, so my grasp can’t be that good, right !?! I can solve for the fixed rate and value a swap, however I would just want to get someone elses take reagarding this.

**Does this mean that the fixed/swap rate could be used to discount both the floating and fixed side and would result in the same value at initiation for both ???** Not seeing in the math how the fixed rate applies to the floating rate…

Thanks for any help!!!