Forwards & Swaps
Forwards fix a future price bilaterally, and interest-rate swaps stack them into the instrument that dominates the rates market.
A forward contract fixes today the price of an asset exchanged later, with terms tailored to the parties and no cash changing hands until maturity. An interest-rate swap is a stack of such forwards on rates: one leg pays fixed, the other pays floating, and only the net difference moves. Swaps dominate rates trading because they reshape cashflows (fixed funding becomes floating, a loan book gets hedged) without exchanging principal, so credit exposure stays tiny. The deep idea is replication: the fixed leg is valued by discounting its coupons off the curve, and a receiver swap is a long bond financed at the floating rate.