Suppose there is a hedge fund with with USD 50M cash and the balance sheet is below.
Asset: 50M Liability: 0 Partner's Capital: 50M
If the hedge fund executed a USD 100M notional TRS with 25% IA (USD 25M will be the independent amount),
How will it be reflected on the above balance sheet?
Will the 3 times leverage be reflected on the balance sheet as well?
Also will the notional or the MTM of the equity swap be reflected on the balance sheet?