A type of capped floored floating rate note in which the floored coupon varies over the life of the note/ bond. An example is a bond that pays a floating coupon that is subject to a floor rate (say 3%) whose level is stepped from time to time: it adjusts by steps of 0.1% downward. This floating rate note helps an issuer adjust a previously set floor even lower depending on prevailing market rates at the time.
Derivatives
Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
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