Total return swap

A Total Return Swap (TRS) is a financial contract between two parties, typically referred to as the "payer" and the "receiver." In a TRS, one party (the total return payer) agrees to pay the total return of a specific asset (which can include capital appreciation, dividends, or interest) to the other party (the total return receiver) in exchange for a series of cash flows, usually as a fixed or floating interest rate.