A "Floating Rate" refers to an interest rate that can change over time, typically in relation to a benchmark rate like the LIBOR or SOFR. This means that the interest payments on a loan or investment can increase or decrease based on market conditions, making it different from a fixed rate, which remains constant throughout the term. Floating rates are commonly used in various financial products, including bonds, mortgages, and derivatives. They can offer potential benefits, such as lower initial rates, but also come with risks, as payments may rise if interest rates increase, impacting borrowers' budgets and investment returns.