Products & Risks第 17 / 125 题
A call feature on a corporate bond primarily benefits:
a.The issuer, who can redeem the bonds early, typically when interest rates fall
b.The bondholder, who is guaranteed a higher yield
c.The underwriter, who earns extra commission
d.The rating agency
解析
A call provision lets the issuer redeem bonds before maturity, usually at a small premium. Issuers exercise calls when rates have fallen so they can refinance at lower cost, which exposes bondholders to reinvestment risk. To compensate, callable bonds generally offer higher yields.
免费刷完整 125 道题库 — 无需注册。
同考点相关题目
- A convertible bond gives the holder the right to:
- A convertible bond has a par value of $1,000 and a conversion price of $40. How many shares of common stock will the holder receive upon conversion?
- Using a conversion ratio of 25 shares per bond, at what common stock price is a convertible bond trading at parity with a bond market price of $1,050?
- Under the Investment Company Act of 1940, an open-end investment company (mutual fund):
- The public offering price (POP) of a mutual fund share with a front-end sales load is calculated as:
- A mutual fund share has a net asset value (NAV) of $19.05 and a maximum sales charge of 5%. What is the public offering price?