callable bond investment & finance definition
A bond that the issuer can demand the investor return before its stated maturity date. The issuer repays the investor the principal amount.
A callable bond is a type of bond issue that allows the issuer of the bond to retain the privilege of redeeming the bond at some point before the bond reaches the date of maturity.
Callable bond
A bond which the issuer can decide to redeem before its stated maturity date. A call date and a call price are always given.
CALLABLE BOND - A bond that the issuer is permitted or required to redeem before the stated maturity at a specified price, usually at or above par, by giving notice of redemption in a manner specified in the bond contract.
Callable Bond Debt securities redeemable by the issuer before maturity at a specified price on, before or after a specified date. Typically, bonds are called when interest rates fall so that new bonds can be floated at a lower rate.
Callable Bond A bond that the issuing company has the right to buy back at a pre-specified price.
Cap See Capitalization ...
Callable bonds.
Bonds that are redeemable by the issuer prior to the maturity date, at a specified price at or above par. (The Treasury has not issued callable bonds since 1985.)
Coupon.
Callable Bond
A bond that is redeemable by the issuer prior to the maturity date at a specified price.
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Callable Bonds
Bonds that give the issuer the right to redeem the bonds before their stated maturity.
Capital Gain ...
Callable Bonds - Treasury bonds that can be redeemed by Uncle Sam five years before maturity.
Callable bond: A bond that can be redeemed by the issuer before it matures.
Callable Bond: A bond which the issuer may redeem prior to maturity by paying a stated call price.
Capacity Utilization: See release details.
Callable bond - A bond that can be officially repaid by the issuer prior to its maturity date (Out of courtesy, a premium is usually paid when the bond is repaid.) ...
Callable bond
A callable bond can be redeemed by the issuer before it matures if that provision is included in the terms of the bond agreement, or deed of trust.
Callable Bonds and Redeemable Bonds
Callable Bonds and Redeemable Bonds are bonds that can be redeemed or paid off by the issuer prior to the bonds' maturity date.
Callable bond A bond that is subject to redemption by its issuer before maturity.
Callable Bond: A callable bond contains an option that grants the issuer of the bond (an agency such as the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation) the right to mature the security early and return ...
Callable bonds are bonds that will not necessarily meet the maturity date.
Callable bond
A bond that provides the borrower with an option to redeem the issue before the original maturity date.
Callable bonds will pay a higher yield than comparable non-callable bonds.
What are Callable Bonds? Bonds typically come with a face value, a coupon rate, and a maturity date.
non-callable bond A bond that cannot be redeemed before it matures. Also known as bulletbond. non-cash expense An income statement expense for which no cash was spent (i.e. amortization or depreciation).
A feature of some callable bonds that establishes an initial period when the bonds may not be called.
Call provision
An embedded option granting a bond issuer the right to buy back all or part of the issue prior to maturity.
[Harvey] call price The price at which a callable bond or security is redeemable. It is used in connection with preferred stocks and debt securities having a fixed redemption value.
Callable Bond Definition: A (noncallable) Bullet Bond (q.v.), minus (i.e., short) a Call Option (q.v.) on the bond. The Call Price as a function of calendar time is the Call Schedule. Example: The U.S.
call option: The right given a buyer to buy stock at a specified price within a certain time period callable bond: A bond that can be officially repaid by the issuer prior to its maturity date (Out of courtesy, ...
An issuer may choose to redeem a callable bond when current interest rates drop below the interest rate on the bond. That way the issuer can save money by paying off the bond and issuing another bond at a lower interest rate.
The price at which a callable bond or security is redeemable. It is used in connection with preferred stocks and debt securities having a fixed redemption value.
To protect investors, callable bonds often require the issuer to pay a call premium to the bondholder.
Optionality - a bond issuer may embed certain options within the bond.
Usually refers to callable bonds. The period of time when a bond cannot be called, no matter what the interest rate is.
Under certain circumstances the company that issues a bond, if stated as a callable bond from the purchase, may call a bond in. Essentially they can buy the bond back from the bond owner to avoid paying them interest.
Callable Preferred - Similar to callable bonds, this feature exists in many preferred shares to provide the issuer with the ability to redeem their preferred stock in the future at some point.
US Savings Bonds are a registered, non-callable bond issued by the U.S. Government, and are backed by its full faith and credit.
Dealers normally purchase a block of high-quality and non-callable bonds - often government issues - to create strip bonds. A strip bond has no reinvestment risk because the payment to the investor only occurs at maturity.
Call yield is the yield that would be realized on a callable bond in the event that the bond was redeemed by the issuer on the next available call date. Also known as yield-to-call.
Capital Market ...
What Is a Callable Bond? Understanding Call Dates and Reinvestment Risk in ...
Risks of Bond Strategy when Interest Rates Rise - Bonds Fall in Price As In...
Risks of Bonds: Inflation Risk, Liquidity Risk, Reinvestment Risk ...
Yield to Call
The percentage rate of a callable bond or note if one were to buy and hold the security until the next available call date.
For bonds that have embedded options, such as puttable and callable bonds, Macaulay duration will not correctly approximate the price move for a change in yield.
YTM is also needs to be adjusted for callable bonds.
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Valuation ...
A protective Guarantee that, in the event a High yield Bond is called, the issuing Corporation will replace the bond with a Noncallable bond of the same life and terms as the bond that is being called.
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Other variations on corporate bonds include convertible bonds, which the holder can convert into stock, and callable bonds, which allow the company to redeem an issue prior to maturity.
Issuers ...
Optionlike Securities - Callable Bonds, Convertible Securities, and Warrants
Put-Call Parity
Theoretical Pricing Models: Binomial Option Pricing And The Black-Scholes Formula
The Greeks: Delta, Gamma, Theta, Vega, and Rho ...
Price compression
The limitation of the price appreciation potential for a callable bond in a declining interest rate environment, based on the expectation that the bond will be redeemed at the call price.
Types of corporate bonds include callable bonds and convertible bonds. If you would like to buy bonds of this nature keep in mind that they contain higher yields because there is a higher risk of a company defaulting than the government.
The United States Treasury is the most common issuer of non-callable bonds. Business bonds usually have some type of call option, except during periods of low interest rates when there is little incentive for a company...
Though, it is better than not being paid back at all, but the investor has to bear the brunt on account of opportunity cost. However, investor sometimes prefers callable bonds when they anticipate the interest rates to rise before the maturity.
 See also: Callable, Bonds, Maturity, Interest, Investment
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