A floating rate fund is a fund that invests in fixed or floating interest-rate financial instruments. A floating rate fund invests in bonds and debt instruments with
fluctuating interest payments at the underlying interest rate level. A fixed-rate investment will typically have a predictable, stable income. Fixed-rate investments,
however, lag behind the market as their returns remain fixed, as interest rates rise. At least 65% of the total assets are expected to be invested in floating rate
instruments. MIBOR is typically related to floating rate instruments. The interest rate is regularly adjusted depending on the motion of the interest rate.
Floater Fund :
These mutual funds invest in interest-floating bonds. If interest rates rise, then bond prices fall, increasing shareholder returns, and vice versa.