Islamic Finance
Khiyar al-Ruyat
January 17, 2022
Islamic Finance
Tawriq
January 18, 2022

A floating-rate note (FRN) which has a minimum and a maximum interest rate, i.e., an embedded collar. This collar has the effect of limiting the reference rate to minimum and maximum values so that the holder can confine fluctuations in the reference rate to a specific range (a lower and an upper boundary).

A mini-max FRN is also known as a mini-max floater or a collared floating-rate note.

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