Sentences with phrase «callable investors»

Not exact matches

Instead, investors in their 50s should be looking to possibly invest in callable preferreds yielding 6 percent to 8 percent that are at or below the call price, he said.

If a callable floater is called by the issuer prior to maturity, the investor may be unable to reinvest funds in another floater with comparable terms.

I would caution any investor loooking at universal life products to avoid investing in callable zero coupon bonds.

Callable bonds are more risky for investors than non-callable bonds because an investor whose bond has been called is often faced with reinvesting the money at a lower, less attractive rate.

When rates drop to 6 %, the company calls the bonds, pays each investor his principal and a small call premium, and then issues new callable bonds with a 6 % interest rate.

Callable bonds are able to be purchased back by the company before they mature, potentially exposing investors to the risk of being forced to sell a good investment.

Premium callables may be used when the bullish investor believes that rates are unlikely to fall very far.

Discount callables are a better choice when the investor believes volatility will be low but prefers more protection in an environment of rising interest rates.

Most preferred shares are also callable, meaning the issuer can redeem the shares at any time, so they provide investors with more options than common shares.

Declining interest rates may accelerate the redemption of a callable bond, causing an investor's principal to be returned sooner than expected.

A callable bond is worth less to an investor than a noncallable bond because the company issuing the bond has the power to redeem it and deprive the bondholder of the additional interest payments he'd be entitled to if the bond was held to maturity.

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 ovCallable 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 ovcallable 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.

1) pays a fixed dividend rate of at least 6.5 %; 2) Become callable five years after IPO; 3) Pays dividends quarterly; 4) Be rated «investment grade» by Moody's Investors Service; 5) Be issued by a company that has a perfect track record of never having suspended the dividend payments on a preferred stock (and these are mostly decades old, multibillion dollar companies); 6) Have a «cumulative» dividend obligation; 7) Be issued by a U.S. company; 8) Not be convertible to common stock in the future; 9) Have easy (online) access to the prospectus at IPO; and 10) Have an initial share value (par) of $ 25.00.

A characteristic of CMOs and other callable or prepayable securities that causes investors to have their principal returned sooner than expected in a declining interest rate environment, and later than expected in a rising interest rate environment.

Callable bonds are obviously favorable to the municipality and detrimental to investors in periods of falling interest rates.

Premium callables would generally be used when the bullish investor believes that rates are unlikely to fall very far.

If an investor has the view that rates may well be volatile in either direction over the near term but are likely to remain in a definable range over the next year, an investment in callable securities can significantly enhance returns.

With a callable security, the investor's compensation for selling the option is reflected in a higher yield and lower price as compared to a similar bullet security with the same maturity.

Discount callables would generally be chosen when the investor believes volatility will be low but prefers more protection in an environment of rising interest rates.

Many investors use callable securities within a total return strategy — with a focus on capital gains as well as income — as opposed to a buy and hold strategy focused on income and preservation of principal.

Yields on callable bonds tend to be higher than yields on noncallable, «bullet maturity» bonds because the investor must be rewarded for taking the risk the issuer will call the bond if interest rates decline, forcing the investor to reinvest the proceeds at lower yields.