Floating Rate Note (FRN)
variable rate bonds with an interest rate that is periodically reset, usually every three to six months, and that carry a fixed spread, usually over the six-month London Interbank Offered Rate (LIBOR).
A floating rate note is a medium-term debt instrument that pays a variable interest rate. The coupon is usually a premium to LIBOR or its local equivalent such as Euribor.
Definition of
floating rate
Finance
interest rate fluctuating as market fluctuates an interest rate that is not fixed and which changes according to fluctuations in the market ...
A floating rate note (FRN) is a floater issued by a corporation, sovereign or government sponsored enterprise. Typically, FRNs have maturities of about five years.
FRN (floating rate note)
A floating rate note, often called an FRN or "floater", is a debt instrument that pays a floating interest rate. The interest rate is usually based on an accepted market benchmark rate such as LIBOR.
FLOATING RATE BOND - a type of bond bearing a yield that may rise and fall within a specified range acc...
FLOATING RATE CONVERTIBLE NOTE (FRCN) - a debt instrument that is a short-term debt obligation where th...
Floating Rate Notes are different than fixed rate notes because they pay out variable coupon interest payments at each period (monthly, quarterly, semi-annually or annually).
Floating rate bond
Similar financial terms
Inverse floaters
Bonds whose coupon rate moves in the opposite direction from the change in interest rates.
Floating Rate Contract
A guaranteed investment contract in which the credit rate is tied to some variable or "floating" ("floating") interest rate benchmark, such as a specific-maturity Treasury yield.
Floating Rate Notes (FRN's)
Floating Rate Notes (FRN's) are long-term (5 years or more) debt securities whose interest rates are adjusted periodically in line with a benchmark rate.
floating rate preferred stock, the dividend on which is adjusted every
seven weeks through a Dutch auction.
Average rate of return (ARR)
The ratio of the average cash inflow to the amount invested.
Floating Rate Note (FRN)
A debt security with a variable interest rate. FRNs are normally benchmarked to a reference rate such as LIBOR. Also known as a floater.
Floating Rate
Rather than a fixed interest or coupon rate, some bonds and CDs have a floating interest rate which is adjusted periodically to market conditions. It is also called Variable Rate.
Floating Rate Bond A debt security whose COUPON RATE is periodically adjusted upwards or downwards, usually within a specified band, on the basis of a benchmark interest rate or an index.
Floating Rate Interest
As opposed to a fixed rate, the interest rate on this type of deal will fluctuate with market rates or benchmark rates. One example of a floating rate interest is a standard mortgage.
Floor Broker ...
Floating rate: an interest rate that is not fixed and which changes according to fluctuations in the market
Floor: a lower limit on an interest rate, price, or the value of an asset.
Floating rates
Any interest rate that changes on a periodic basis. The change is usually tied to movement of an outside indicator, such as the prime interest rate.
Floating Rate Note (FRN):
A short-term bond issued (typically on the Euromarkets) with a variable (floating) coupon or interest rate, which varies in line with a reference short-term market interest rate (usually, the LIBOR or prime rate).
Floating rate
A debt security or corporate preferred stock whose interest rate is adjusted periodically to reflect changing money market rates is known as a floating rate instrument.
Floating Rate Bond
A long-term bond for which the interest rate is adjusted periodically according to a pre-determined formula, based upon specific market indicators.
FLSA
Fair Labor Standards Act.
Floating Rate
Interest rate that is reset periodically, usually every couple of months or sometimes daily.
Floating securities
Securities bought in a broker's name and resold quickly to attain a profit in a short amount of time.
Floating Rate
An interest rate which moves in line with market or benchmark rates instead of remaining constant for the life of a loan.
Floating Rate Notes
See FRNs.
Floating Rate: An interest rate that is reset periodically.
Floating Rate Notes (FRNs): Notes where the interest is reset periodically to a floating rate.
Floor: A level which an interest rate or currency is structured not to go below.
FRNs (floating rate notes)
A note whose interest payment varies with short-term interest rates.
Full cost ...
Floating Rate Bonds
These are short to medium term interest bearing instruments issued by financial intermediaries and corporates. These bonds are issued for minimum amount of Rs. 10,000 and in multiples of Rs. 10,000 only.
Floating rate note whose interest rate is reset at more frequent intervals than the rollover
period (e.g. a note whose payments are set quarterly on the basis of the one-year interest rate).
Related Terms:
Accrual bond ...
Floating Rate - Refers to the condition whereby exchange rates are relatively free to change. It can also refer to an interest rate which changes relatively quickly or frequently.
Flotation - Is the initial offering of stock to the public.
Floating rate bond.
Floating exchange rate
A countrys decision to allow its currency value to freely change.
Floating rate CMO tranches that have coupon rates that are determined by formulas such that the interest rate paid is a multiple of an underlying rate minus a stated spread.
Floating Rate Note (FRN)
A bond with a floating rate of interest. FRNs are common in the offshore bond market where their interest rate is typically periodically set at a spread over LIBOR.
Floor ...
Inverse floating rate note
A variable rate security whose coupon rate increases as a benchmark interest rate declines.
Fixed or Floating rate home loan: Which is Better?
Should a borrower opt for a fixed rate home loan or a floating rate home loan is a matter of personal decision which has to be taken by the borrower.
Home loan terms - Do you know ...
The fixed or floating rate paid on preferred stock based on par value.
Personal Finance Headlines
SEARCH: ...
The basis of floating rate security is called as the reference rate.
Refunding
Reinvestment Risk ...
A preferred, floating rate issue, whose interest rate is tied to Treasury security rates. They can be exchanged for common stock or cash after the next period's dividend rates are announced.
Receive fixed counterparty The transactor in an interest rate swap who receives payments based on the fixed rate and makes payments based on the floating rate.
The writer therefore becomes the fixed-rate receiver/floating rate payer. Cancel Used in the context of general equities. Void an order to buy or sell from 1) the floor, or 2) the trader/salesman's scope.
The writer therefore becomes the fixed-rate receiver/floating rate payer. Callable A financial security such as a bond with a call option attached to it, i.e., the issuer has the right to call the security.
A ceiling is a common feature of floating rate notes. central assets account A single account at a brokerage or bank which includes both banking and brokerage...
[NYSE] auction rate preferred stock Floating rate preferred stock, the dividend on which is adjusted every seven weeks through a Dutch auction.
Fixed for floating swap An interest rate swap in which the fixed rate payments are tradeed for a floating rate. Fixed income equivalent Also called a busted convertible.
Dividend rate The fixed or floating rate paid on preferred stock based on par value. Dividend reinvestment plan (DRP) Automatic reinvestment of shareholder dividends in more shares of a company's stock, often without commissions.
A fall in the value of a currency that has been pegged, either because of an announced reduction in the par value of the currency with the peg continuing, or because the pegged rate is abandoned and the floating rate declines.
3.
The bid to Libor's offer has been used as a reference for floating rate payments for especially strong borrowers.
London Interbank Mean Rate
Abbreviated as LIMEAN, this is the midpoint of the LIBOR-LIBID spread.
Widespread inflation after the United States abandoned gold convertibility forced the IMF to agree (1976) on a system of floating rates, ...
A term in the interest rate swap market referring to the person who pays the fixed interest rate and receives the floating rate from the cou...(Read more)
Payment Card ...
On the other hand, the term of the loan may be substantially longer than the basis from which the floating rate loan is priced. A 30 year mortgage is a good example. The rate may be priced off a 6 month index.
For example, consider the valuation of a fixed-to-floating Interest rate swap where Party A pays a fixed rate, and Party B pays a floating rate.
AUCTION RATE PREFERRED STOCK (ARPS) - Floating rate preferred stock, whose dividend is adjusted every s...
AUCTIONEER - A professional (real estate broker or auctioneer, depending on local laws) who sells prope...
Revolving credit and term loan bank facilities
Fixed and floating rate senior secured notes
Subordinated notes (with and without warrants)
Redeemable preferred stock with warrants
Convertible debt and preferred stock
Common equity ...
Dividend Rate definition :
The fixed or floating rate paid on preferred stock based on par value.
Have YOU got what it takes?
FREE 10-step guide to successful penny share investing..
The frequency with which the floating rate changes.
Residual assets
Assets that remain after sufficient assets are dedicated to meet all senior debtholders' claims in full.
For example, interest rate swaps, where floating rate interest is exchanged for fixed rate interest, protects a corporation against rises in rates or allows it to take advantage of a better rate.
A floater is a fixed income instrument whose coupon or interest rate is periodically reset according to a short-term rate index such as the LIBOR or the prime rate. Examples include floating rate notes or floating rate certificates of deposit.
Currency Coupon Swap - A fixed-for-floating rate nonamortizing currency swap traded primarily through international commercial banks.
Over the term of the agreement, the counter parties exchange fixed or floating rate interest payments in their swapped currencies.
The interest rate paid on a bond issue. Quoted in percentage terms. Can be a fixed or floating rate.
Currency Swap ...
Bordo, Michael D., and A. J. Schwartz, eds. 'Transmission of Real and Monetary Disturbances Under Fixed and Floating Rates.' Cato Journal 8, no. 2 (1988): 451-472.
Prepayment Penalty (in banking)
Spread (business term)
Credit Risk (in banking)
Competitive Bid Option (in banking)
Floating Rate Certificate of Deposit (in banking)
Variable Rate Loan (in banking)
Selling Short (finance term) ...
These are funds which invest most of their assets in money market instruments (i.e. cash and near cash, such as bank deposits, certificates of deposit, very short term fixed interest securities or floating rate notes).
CAT standards
- ...
 See also: Banks, Expense, Funding, Interest rate swap, Values
|
