Cutting to the chase, we find that 17.5% floating exposure acts to minimise interest rate volatility when compared with a reference of 10yr Fixed. Interest rate costs are also reduced, from 4.5% to ...

(MENAFN- ING) Borrowers tend to have both fixed and floating rate debt. Floating rate debt averages at a lower cost over time. But its more volatile than fixed rate debt (including mark-to-market).

Recently, we published a short report that sought an optimal fixed versus float rate mix for a liability portfolio. We identified 17.5% as an optimal proportion of floating rate debt, one that managed ...