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Inverse Floating-Rate Note
(redirected from Inverse Floating-Rate Notes)

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Inverse floating-rate note
A variable-rate security whose coupon rate increases as a benchmark interest rate declines.

Inverse Floating-Rate Note
A bond or other debt security with a variable coupon rate that changes in inverse proportion to some benchmark rate. For example, an inverse floating-rate note may be linked to LIBOR; as the LIBOR decreases, the coupon rate increases and vice versa. An inverse floating-rate note allows a bondholder to benefit from declining interest rates. It is also called an inverse floater.


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