OIS Rate
The OIS rate is the fixed rate exchanged in an Overnight Indexed Swap. The swap’s floating leg is tied to an overnight policy rate such as the Secured Overnight Financing Rate (SOFR) in the United States or the Effective Federal Funds Rate (EFFR).
Example: A risk-management desk references the current OIS rate for a 3-month tenor to estimate the fixed leg of a short-term swap tied to SOFR when hedging near-term rate risk.
💬 Comments