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For all NPers reading this, I do realize that this is a dual post. Apologies in advance.Hi,Assume that I have a forward settling single-name CDS on an issuer that has a 'flat' credit curve, of say 60bps at all the various par points between 6M and 30Y.If the trade is a 5 year CDS that starts in 3 months time - 9/27/2007 to 12/20/2011, what would be the NPV of the trade if the premium leg is paying 60bps? Logically, I would assume the NPV to be zero regardless of whether the trade settles tomorrow or in 3 months.However, this is probably not seen in practice. But I don't understand why not. Are there any modifications that have to be made for a forward settling trade?Thanks.

If the trade starts in 3 months, what happens if the company defaults between now and then; if you're to pay for a default then you'll want compensation for that since you're not receiving the premium, so you'll want a higher spread.

Hi all,talking about fwd CDS, would youi agree in saying that the fwd risky PVO1 is equal to the fwd starting risky PVO1 (computed with today's credit curve) divided by the survival probability up to the start date of the fwd trade ?thx & rgdsslym