DEFINITION of 'Super Floater'
A floatingrate collateralized mortgage obligation (CMO) tranche whose coupon rate is determined by a formula based on an interestrate index such as LIBOR. The coupon rate is leveraged i.e. it moves more than one basis point for each basis point change in the index.
A super floater can also refer to a leveraged floating rate note whose coupon rate changes are magnified (ratio greater than one) when the reference interest rate or index changes. Since their coupon rate moves in the same direction as interest rates, super floaters are suitable investments in a rising interestrate environment.
BREAKING DOWN 'Super Floater'
As an example, a super floater coupon may be determined by the following formula: 2 x (oneyear US$ LIBOR)  4%. So if the oneyear LIBOR is 3%, the coupon rate would be 2 x 3%  4% = 2%. To prevent the coupon rate getting negative, a floor rate on the coupon is usually specified.

Deleveraged Floater
A fixedincome instrument with a floating coupon rate that is ... 
Leveraged Floater
A security, generally a bond, which has a leverage factor of ... 
Reverse Floater
A floatingrate note in which the coupon rises when the underlying ... 
Inverse Floater
A bond or other type of debt whose coupon rate has an inverse ... 
Current Coupon Bond
A bond with a coupon rate that is within 0.5\% of the current ... 
Coupon Rate
The yield paid by a fixed income security. A fixed income security's ...

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