A floater whose coupon rate is typically the difference between two reference rates plus (or minus) a fixed percentage (quoted margin). The coupon formula is:

Coupon rate = (R1 – R2) + quoted margin

Where R1 and R2 are two underlying reference rates.

For example, the coupon rate could be the difference between the 10-year CMT rate and the 3-month LIBOR plus 100 basis points (the quoted margin). This floater resets and pays coupon on a periodical basis (e.g. quarterly).