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Loan and Mortgage Terms Glossary |
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Dual Index Note:
A note with a coupon rate that varies in relation to the movement of two different indexes, typically the constant maturity treasury (cmt) rate and libor. A dual index note usually has a fixed rate for a brief period, followed by a longer period of variable rates. For example, the coupon might start out as a fixed rate of 8 percent for two years, then switch to a variable rate calculated as the 10-year treasury rate plus 300 basis points minus the 6-month libor. A dual index note is a type of structured note.
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