A significant amount of the Fixed-To-Floating Rate Preferred and Baby Bond securities tied to 3-Month Libor are above initial coupon rate when they float. Recent legislation removes risk associated ...
Cutting to the chase, we find that 17.5% floating exposure acts to minimise interest rate volatility when compared with a reference of 10yr Fixed. Interest rate costs are also reduced, from 4.5% to ...
Floating-rate debt outperforms fixed-rate holdings when interest rates are rising, research finds, but be prepared to pivot when they start falling.