An interest rate floor the rate of which is an average of the reference rate over a specific period of time. The strike rate can be a fixing of the reference rate (and hence it is called a floating average floor) or a fixed rate (so it is known as a fixed average floor). The average can be calculated in various ways: arithmetic, geometric, weighted, partial averaging over a window, etc. As such, the average floor is less sensitive than vanilla floors to huge changes in market conditions or influential manipulations by traders.

The average floor is also known as an Asian floor or an average rate floor.