what is a floating rate fund 
a floating rate fund is a fund that invests in financial instruments that pays a variable or floating interest rate a floating rate fund which can be a mutual fund or an exchange traded fund etf invests in bonds and debt instruments whose interest payments fluctuate with an underlying interest rate level typically a fixed rate investment will have a stable predictable income however as interest rates rise fixed rate investments lag behind the market since their returns remain fixed floating rate funds aim to provide investors with a flexible interest income in a rising rate environment as a result floating rate funds have gained in popularity as investors look to boost the yield of their portfolios 