"Converting" a USD bond to an equivalent foreign bond?

Say if I have a corporate bond XYZ denominated in USD at USD LIBOR + 63 bps. How do I compare it to some foreign corporate bonds issued in UAE dirham (which is pegged with USD)?

Basically, how do I "translate" this XYZ bond into an equivalent bond denominated in AED? How will the process differ if I am converting it to a foreign bond in EURO (which is not pegged with USD)? What role do swaps play in the process, if they are ever needed?

I'm a novice in this field and would really appreciate anyone who can explain how these comparison and conversion are done. Thanks in advance for all the feedback!

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2 Comments

Martinghoul

HF

13y

Is the USD issue a floater or smth? At any rate, a x-ccy basis swap is the instrument used in this context...

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Authored by: Certified Hedge Fund Professional - Portfolio ManagerCertified Hedge Fund Pro

mrb87

HF

13y

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Authored by: Certified Hedge Fund Professional - PrincipalCertified Hedge Fund Pro

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