I'm looking for an intuitive explanation of how to understand the 'price'/trade spread of a CDS.
Looking say at a current CDS on Santander, the index states that it is currently at 132. As I understand it, this is the trade spread.
I also understand that the 100bp coupon gets paid quarterly (i.e. 25k per quarter).
What is the actual price I would have to pay today to own this CDS? This is the bit I am not understanding. How does a value of 132 translate into a price? (I originally thought that 132bp * notional would be the price?)
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