BASIS POINTS is 0.01% in yield. For example, in increasing from 5.00% to 5.05%, the yield increases by five basis points.
INVERSE FLOATING RATE is a security that has a fixed maturity with a coupon rate that is reset at a pre-specified amount, minus a given short-term rate or index, such as 18% minus the six-month LIBOR rate, or 30% minus three times the 30-day commercial paper composite rate. These instruments provide a way to hedge against lower short-term rates and/or a steeper yield curoe without extending the maturity. As shortterm rates decline, the coupon rate increases.
MONETARY is anything pertaining to or having to do with money, money creation, money supply, and the government management of money.
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