Call risk: Difference between revisions
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imported>Doug Williamson m (Categorise.) |
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* [[Soft call protection]] | * [[Soft call protection]] | ||
* [[Spens clause]] | * [[Spens clause]] | ||
[[Category:Financial_risk_management]] | |||
Revision as of 14:39, 28 February 2018
The risk to a lender/investor from the potential calling - for early redemption - of a callable bond. It gives the investor the unexpected problem of re-investing their money returned early.
So if interest rates have fallen the investor will receive a lower than expected return, for the unexpired term of the original (callable) bond.
