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Stocks

Floating Rate Security

A floating rate security is one whose interest rate or dividend is influenced by specific market indicators. These rates are often tied to an administered rate, such as the prime rate. This means that as the administered rate changes, so does the interest or dividend of the security. This can provide investors with a potential advantage, as they may be able to earn higher returns when market indicators are favorable. However, it also introduces a level of risk, as these rates can fluctuate and potentially decrease the returns on the investment.

Related terms

Relative Dividend Yield

Understand the meaning and definition of Relative Dividend Yield in the context of stock market, trading, and investments.

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Quiet Period

Understand the meaning and definition of Quiet Period in the context of stock market, trading, and investments.

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Top-Line

Understand the meaning and definition of Top-Line in the context of stock market, trading, and investments.

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EPS

Understand the meaning and definition of EPS in the context of stock market, trading, and investments.

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Exempt Issuer

Understand the meaning and definition of Exempt Issuer in the context of stock market, trading, and investments.

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Operating Margin

Understand the meaning and definition of Operating Margin in the context of stock market, trading, and investments.

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