Phrases with «embedded options»

"Embedded options" refers to features within financial contracts that give one or both parties the right to make certain decisions or take certain actions in the future. These options are built into the contract itself, making them "embedded." They can provide flexibility and potential benefits to the parties involved, allowing them to adapt to changing circumstances or optimize their financial positions. Full definition

Sentences with «embedded options»

  • For each bond, it also addresses that interest rate changes can alter expected bond future cash flows through embedded options. (wisdomtree.com)
  • This concept can be applied to a mortgage - backed security (MBS), or another bond with embedded options, or any other interest rate derivative or option. (en.wikipedia.org)
  • Option - adjusted spread (OAS) is the yield spread which has to be added to a benchmark yield curve to discount a security's payments to match its market price, using a dynamic pricing model that accounts for embedded options. (en.wikipedia.org)
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