(Read more on
callable bonds in «Callable Bonds: Leading a Double Life.»)
Similar issues arise for
callable bonds in the American municipal, corporate, and government agency sectors.
Not exact matches
provision of a
bond that makes it non ‐
callable or not subject to a scheduled call, even though other early redemption provisions may exist as specified
in the prospectus or official statement
Primarily this would occur when there is a drop
in interest rates — issuers often redeem the
callable bond and issue another one at the new, lower interest rate.
Also, many corporate
bonds are
callable, meaning that they can be called
in by the issuing company and redeemed on a fixed date.
I would caution any investor loooking at universal life products to avoid investing
in callable zero coupon
bonds.
Issuers of
callable bonds may choose to refinance by calling their existing
bonds so they can lock
in a lower interest rate.
Check to see if you are investing
in a
callable bond and consider what types of
bonds you may want to think about investing
in advance to offset any potential decrease
in interest income if the
bond is called.
In reality, prices of
callable bonds are unlikely to move much above the call price if lower interest rates make the
bond likely to be called.
If a
bond is
callable, it means that GE could redeem the
bond early, which
in this case it can not.
All the
bonds in each fund either mature or are
callable in the same calendar year.
Callable agency bonds with «step up» coupon rates: callable agency bonds that have a pre set coupon rate «step up» that provides for increases in interest rates or coupon rate as the bonds approach maturity to minimize the interest rate risk for investors ov
Callable agency
bonds with «step up» coupon rates:
callable agency bonds that have a pre set coupon rate «step up» that provides for increases in interest rates or coupon rate as the bonds approach maturity to minimize the interest rate risk for investors ov
callable agency
bonds that have a pre set coupon rate «step up» that provides for increases
in interest rates or coupon rate as the
bonds approach maturity to minimize the interest rate risk for investors over time.
Annuities Auction Rate Securities Business Development Companies
Callable Security Lotteries at Baird Certificate of Deposit Disclosure Closed End Funds and UITs Exchange Traded Products Fixed - Income Securities Featuring a Survivor's Option (or «Death Put») Foreign Transaction Taxes Fund of Hedge Funds Hedge Funds Investing
in Bonds Investment Managers» Placement of Client Trade Orders and Their «Trade Away» Practices IPOs Leveraged and Inverse Funds Managed Futures MLPs MLPs - The Taxation of Master Limited Partnerships FAQs Municipal
Bonds Mutual Funds Disclosure Non-Exchange Traded Equity Securities Non-Rated, Split - Rated, and Below Investment Grade Securities Private Equity Funds REITs Rollover IRAs Securities
in the Lowest Investment Grade Category Structured Products Variable Rate Demand Notes
To take advantage of lower rates
in the future, ABC issues
callable bonds.
In cases of a
callable bond, it may be the call date.
HYHG may contain a significant allocation to
callable high yield
bonds, which are subject to prepayment and other risks that could result
in losses for the fund.
Callable bonds are obviously favorable to the municipality and detrimental to investors
in periods of falling interest rates.
For coupons, which are usually for a stated percentage of the face value of the instrument, the daycount convention does not matter unless the coupon is paid late or the
bond is a
callable bond that is called
in between two coupon payments.
Prices on
callable bonds depend on the market's expectation of interest rates at the time the call feature on a
bond becomes active
in relation to the coupon rate on the
callable bond.
In the debt capital markets field, the team advised on the first issue by a South African insurer of
callable bonds that qualified as secondary capital for the issuer.