# Do floating rate bonds always trade near par?

Do we in practice have that floating rate bonds trade only at par?

How is credit spread included in floating rate bonds in practice? The way I see it is two possible ways.

1. The first is that we have a case of floating rate bonds that pays coupons that are calculated by a benchmark rate $$r_i$$, so that each coupon is for example $$Nr_i/K$$, where $$N$$ is the face value of the bond and $$K$$ is the number of coupons each year, and the last payment is $$N(1+r_i/K)$$. Then the price of the bond is lower than par at the reset date, it is lower than what you would get if you got this cashflow from a secure insitution. Do these types of bonds exist in the real world?

2. The second type would be a bond that at each coupon date pays $$N(r_i/K+s)$$, where $$s$$ is something you get extra, and at the last payment you get $$N(1+r_i/K+s)$$. And then these are priced at par at the reset date. Do these type of bonds exist in the real world?