DEFINITION of 'Floating Price'
The leg of a swap that is based on a fluctuating interest rate. In a plain vanilla interest rate swap, there are two streams of cash flows. Each stream is based on the same amount of notional principal, but one stream pays interest on that notional principal at a fixed rate (or fixed price) and one stream pays interest on the notional principal at a floating rate (or floating price).
BREAKING DOWN 'Floating Price'
While the fixedrate stream does not change for the duration of the swap, the floating rate stream changes periodically. The floating rate will adjust as its benchmark interest rate, changes in accordance with market conditions. The benchmark is often LIBOR, but may also be the yield on oneyear U.S. Treasuries or another interest rate. Two parties, called counterparties, enter into fixedforfloating swap transactions to reduce their exposure to changes in interest rates or to attempt to profit from changes in interest rates.

Notional Principal Amount
In an interest rate swap, the predetermined dollar amounts on ... 
Amortizing Swap
An exchange of cash flows, one of which pays a fixed rate of ... 
Asset Swap
Similar in structure to a plain vanilla swap, the key difference ... 
Reversible Swap
An exchange of cash flows that allows one counterparty to use ... 
Delayed Rate Setting Swap
An exchange of cash flows, one of which is based on a fixed interest ... 
Bond Market Association (BMA) Swap
A type of swap arrangement in which two parties agree to exchange ...

Trading Strategies
Interest Rate Swaps Explained
Plain interest rate swaps that enable the parties involved to exchange fixed and floating cash flows. 
Investing
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Investing Basics
How Are Interest Rate Swaps Valued?
When trading in financial markets, higher returns are generally associated with higher risk. Hedge your risk with interest rate swaps. 
Professionals
Interest Rate and Equity Swaps
CFA Level 1  Interest Rate and Equity Swaps. Learn the components of plain vanilla interest rate swaps and equity swaps. Contains sample calculations finding the payments for each swap. 
Professionals
Currency Swaps
CFA Level 1  Currency Swaps. Discusses the features of a currency swap. Learn how comparative advantage affects the payments made during a swap agreement. 
Professionals
Swaps
CFA Level 1  Swaps. Learn how swaps can change the characteristics of assets or liabilities. Discusses the cash flows of interest rate and currency swaps. 
Investing Basics
Managing Interest Rate Risk
Interest rate risk stems from the possibility that an interestbearing assetâ€™s value will change due to changing interest rates. 
Investing
How To Read Interest Rate Swap Quotes
Puzzled by interest rate swap quotes terminology? Investopedia explains how to read the interest rate swap quotes 
Investing Basics
Different Types of Swaps
Investopedia explores the most common types of swap contracts. 
Forex Education
Currency Swap Basics
Find out what makes currency swaps unique and slightly more complicated than other types of swaps.

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What are interest rate swaps on the OTC market?
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What is an absolute rate?
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Do interest rate swaps trade on the open market?
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