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All you need to know about floating rate bonds 

A floating rate bond is a type of debt instrument with variable coupon payments, where the interest rate changes depending on a benchmark rate that is adjusted periodically.

In India, the government issues the majority of the floating rate bonds, which make up a sizeable portion of the market.

Floating rate funds offer diversification to fixed-income portfolios at a low investment limit, in contrast to a standard debt fund where the return is set. 

There is no assurance of a steady source of income from a floating rate bond in the future as they may underperform compared to market interest rates.

RBI announced on December 6 that the interest rate on the central government's floating rate bond 2031 will be 7.69 percent annually from December 7, 2022 to June 6, 2023.

Risks associated with floating-rate bonds include a lower yield than fixed-rate bonds if the short-term benchmark rate declines and performance underperformance compared to market interest rates.


It is recommended to speak with a financial expert before investing in floating rate bonds in India.

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All you need to know about floating rate bonds

A floating rate bond is a type of debt instrument with variable coupon payments often issued by governments, financial organizations, and businesses to borrow money from the general public.

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All you need to know about floating rate bonds

A floating rate bond is a type of debt instrument with variable coupon payments often issued by governments, financial organizations, and businesses to borrow money from the general public.

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