Exchange of Futures for Swaps

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An exchange of futures for swaps (EFS) transaction is a type of exchange related privately negotiated and simultaneous trade of futures for an over-the-counter ("OTC") swaps position.

It is similar to ""exchange for physicals," "exchange for options," and is sometimes called "exchange for risk."[1]

An EFP transaction involves a privately negotiated and simultaneous exchange of a futures position for a corresponding position in the underlying physical.

An EFS works similarly to an exchange of futures for physicals (EFP), except that an EFS allows market participants to exchange a position in a futures contract on a commodity for a cash-settled position instead of the physical commodity.

An EFS also gives market participants the ability to liquidate a swaps position in a market that may have limited liquidity, for example the over-the-counter (OTC) swaps market.


In May of 2013, the U.S. Commodity Futures Trading Commission initiated an investigation into EFS with a “special call” asking market participants to provide documents that their EFS transactions were legal. The CFTC requested information on EFSs executed after the passage of the Dodd-Frank financial reform law in 2010 until this year.[2]