Capital Guarantee
Inverse Floater
An inverse floater (or inverse floating rate note) is a capital guaranteed product with a link to an interest rate. The product pays a coupon depending on the evolution of that interest rate. The coupon calculation is quite simple: the reference interest rate (or a multiple thereof) is deducted from a constant on every coupon date. The result equals the coupon for that period.
The coupon formula is often equal to: