It stands for knock-out floating rate note; a barrier floating rate note in which the coupon is deactivated (knocked-out) if the reference interest rate exceeds or falls below a prespecified barrier level. This instrument allows investors to take a view on the movement of interest rates above or below a desired threshold level, after which coupon payment (whether payable or receivable) becomes ineffective.

A knock-out floating rate note is also known as a knock-out floater.