## CapFloor

**is a direct subtype of Tradable with functions CapFloor Functions, keys CapFloor keys and example object CapFlr that represents a cap or floor or collar on some specified underlying index.**

*CapFloor*The referenced index can be either an ibor interest rate represented by Ibor Rate or a year-on-year inflation index represented by Inflation Index

The cap is a series of caplets, where each caplet is effectively a call option on the underlying index with the strike

**being the same for all caplets.**

*K*The floor is a series of floorlets, where each floorlet is effectively a put option on the underlying index with the strike

**being the the same for all caplets.**

*K*The collar is simply the difference cap - floor, i.e. a portfolio consisting of a long cap and a short floor.

The exact payoff definition is described at CapFloor Type

The pricing methodology is specified in Model[CapFloor]