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Participating Interest Rate Agreement (PIRA)
A Participating Interest Rate Agreement That Caps a Borrower's Cost of Funds and Provides Participation in Any Rate Decline
An off-exchange contract designed to meet an investor's or borrower's need to reduce exposure to adverse interest rate changes while continuing fractional participation in favorable interest rate changes. Similar in structure to a participating forward contract. See also Participation, Participating Forward Contract (diagram).
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