Exchangeable bond and Gap: Difference between pages

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(XB).  
1. ''Risk management - interest rate risk.''


A straight bond with an embedded option to exchange the bond for the stock of a company other than the issuer (usually a subsidiary or company in which the issuer owns a stake) at some future date and under prescribed conditions.  
An abbreviation for interest rate gap.




This right is an option in favour of the holder / investor.
2. ''Differences.''


In return for this additional valuable right, the investor is generally willing to accept a lower rate of interest on the debt.
Any other systematic difference, especially one that should be closed.
 
This saves interest for the issuer / borrower, at the cost of writing the option.




== See also ==
== See also ==
* [[Bond]]
* [[Assets]]
* [[Convertible bonds]]
* [[Behavioural gap]]
* [[Embedded option]]
* [[Ethnicity pay gap]]
* [[Issuer]]
* [[Gap risk]]
* [[Option]]
* [[Gender pay gap]]
* [[Straight bond]]
* [[Expectation gap]]
* [[Subsidiary]]
* [[Interest rate gap]]
* [[Interest rate risk]]
* [[Liabilities]]
* [[Liquidity gap]]
* [[Risk management]]


[[Category:Long_term_funding]]
[[Category:Ethics]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_reporting]]

Revision as of 19:21, 6 November 2021

1. Risk management - interest rate risk.

An abbreviation for interest rate gap.


2. Differences.

Any other systematic difference, especially one that should be closed.


See also