Abstract: The present invention provides a method for providing a total return swap using a dealer hedging facility, the method comprising entering into the total return swap with an approved dealer participant, purchasing an underlying swap reference asset to hedge market risk, funding the purchase of the underlying swap reference asset from a repo counterparty or other short-term funding source committing capital to absorb potential losses from dealer participant and repo counterparty default, and establishing an SEC-registered broker to carry out the functions of the dealer hedging facility.