Call risk: Difference between revisions
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So if interest rates have fallen the investor will receive a lower than expected return, for the unexpired term of the original (callable) bond. | So if interest rates have fallen the investor will receive a lower than expected return, for the unexpired term of the original (callable) bond. | ||
== See also == | == See also == | ||
Revision as of 14:03, 6 May 2016
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.
