Quote Long swap--->you want the swap rate to increase so you pay fix/rec float It doesnt make sense and this is why. a swap can be an asset or liability depending on its current MTM. therefore you cannot say "I am long" or "I am short" a swap. However, bonds are a security hence you can talk abotu long or short positions.my 2bps worth.

QuoteOriginally posted by: daveangelQuote Long swap--->you want the swap rate to increase so you pay fix/rec float It doesnt make sense and this is why. a swap can be an asset or liability depending on its current MTM. therefore you cannot say "I am long" or "I am short" a swap. However, bonds are a security hence you can talk abotu long or short positions.my 2bps worth.makes sensejust Long market / short maket...........

There are too many misreadings/misconceptions flying around here. I believe Martinghoul is right (which is not unusual). Here are a few observations:1) In both the swap (IR swaps, mind you, not CDS) and bond (govt/agency/corporate/muni) markets (US dollar, at least, and I think most of the others), "long" UNIVERSALLY means that you are receiving fixed.2) "DV01", which is a term originally from the bond market UNIVERSALLY is positive if you are long. Tuckman, Bloomberg, every trader I have ever talked to, etc, etc.3) "PVBP" is NOT the same as DV01. No, sir. It is the sensitivity of your portfolio with respect to a +1bp change in whichever rate is relevant. This has the OPPOSITE sign of DV01. NOTE THAT THIS IS NOT AS CONSISTENT A DEFINITION AS DV01! Sometimes people do mean the opposite by this: I have come across both, professionally, from some people who are highly non-confused about most of what matters in finance.You will note that 2) and 3) are VERY CONFUSING. This means that IF YOU ARE CONFUSED, you should ALWAYS ASK. It is COMPLETELY POINTLESS to argue about what market conventions should be: they simply are. That is like arguing about what the color yellow should be called. Everyone in the market knows that some of it's confusing - you just have to learn to deal with it with each new asset-class/security/exchange/contract you come to.The upshot of all this is that, if someone says "my PVBP is $10m", you should ask (at least 2) things until you know them well:1) Which interest rate (or credit spread, etc.) is changing?2) Do you make or lose money if it increases?

Having gone through this thread, can someone tell me if below conclusion is correct w.r.t. bond/cds trades?If my position is long bond or short cds, then as per market convention, my DV01/CS01 would be +ve. Thus DV01/CS01 here is being calculated for 1bp tightening, since my position would profit only when yields/spread tightens. Hence I can say that I am long risk .

Awaiting for someone to confirm my above understanding please....

I don't know abt the CS01, but you're correct regarding DV01, in my personal experience.

Thanks for confirming Martinghoul

This is a funny thread, I probably don't understand everything, but I have struggled with these notions myself repeatedly in the past.I found the following blog very nicely written: http://fermatslastspreadsheet.com/ and also rather than Tuckman I would recommend Corb's book more nowadays at least for this sort of conventional chitchat. In general it is a truly awesome reference especially if you don't really have access to dealer jargon.Other than this I am from a world in which everything is stated very much in bond terms, but I guess that in a pure derivatives setting people like to think in terms of rates and may view things differently. So basically in my world anything referencing a rate exposure is preferably expressed in bond price terms and since bond price move inversely to rates everything is turned around. If you have negatively signed delta you say that you are long delta, etc... which people here called being long the market. I also confirm that to me buying a swap means paying fixed and if you ask a swap trader where you can receive xY, it is not rare that you will hear as confirmation: you want my bid on xY? That's because when you pay fixed you buy a stream of floating cashflows. Very natural, but I know some people who go mental when you start talking about buying swaps.Anyway, I think it gets more folkloric when considering bond futures or eurodollar options skew, which are options written on price based instruments, but everybody I know of thinks in terms of rate vols. This results in very screwy terminology which just needs to be calibrated against your counterparty's understanding. It's not such a big deal though.