NISM Series IV: Currency Derivatives Certification Exam Notes

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  • Floating Rate Bonds (FRBs): Coupons linked to benchmark rates, reset periodically.
  • Caps and Floors: Limits on FRB coupon rates to protect issuers (caps) or investors (floors).
  • Inverse Floater: Coupon inversely related to benchmark rate, decreases as rates rise.
  • Inflation Indexed Bonds: Face value or coupons adjusted for inflation (e.g., WPI, CPI).
  • Step Up/Down Bonds: Coupons increase (step-up) or decrease (step-down) over time.

NISM Interest Rate Derivatives

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