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Floating Rate Bonds (FRBs) are bonds that have a variable coupon, equal to a money market reference rate (like MIBOR or LIBOR) plus a quoted spread (i.e., quoted margin). · Floating rate bonds allow the investor to earn a rate of interest income tied to current interest rates. As such, FRBs carry little interest rate risk. · Its price shows very low sensitivity to changes in market interest rates. When market rates rise, the expected coupons of the FRB increase in line with the increase in forward rates, which means its price remains constant. Thus, FRBs differ from fixed rate bonds, whose prices decline when market rates rise. As FRBs are very less sensitive to interest rate risk, they are considered conservative investments for investors who believe market rates will increase.
The National Commission for Indian System of Medicine (NCISM) and the Central Council for Research in Ayurvedic Sciences (CCRAS), the two prominent ins...
The Cruise Bharat Mission aims to make India a global hub for cruise tourism by which year?
Which significant infrastructure sector showed growth in August 2024 despite the overall contraction in core sector output?
IIFL Finance has raised $175 million through HSBC, Union Bank (Sydney) and Bank of Baroda (IFSC unit).How much has it raised from HSBC?
What is the main objective of the tree plantation drive 'Grow with the Trees' organized by BSF and SBI?
As part of the T+0 settlement cycle initiative, SEBI expanded the number of top market cap scrips eligible for faster settlements from 25 to how many, e...
Which organization hosts the World Telecommunication Standardization Assembly (WTSA)?
During April June 2024, net Foreign Direct Investment (FDI) in India rose significantly. Which sectors accounted for 80% of the gross FDI inflows, and h...
Which city is to host U18 women basketball event?
Recently Ministry of Micro, Small and Medium Enterprises (MSMEs) joins hands with which of the following IIT to facilitate the MSME Design Innovative Sc...