A floored FRN which is also capped: the coupon of the floating-rate note (FRN)cannot increase beyond the cap rate. In other words, the FRN pays a floating coupon which is subject to a maximum and minimum coupon level, irrespective of the where the underlying rate sets.

Other variations include stepped capped FRN and stepped floored FRN, in which the capped coupon/ floored coupon vary over the life of the note/ bond.