Callable Bond

The issuer has the right to redeem the bond at a specified earlier date than the one orginally fixed as the final maturity.

A bond containing povisions that allow the issuer to buy it back at a predetermined price at certain times during its life. Allows an issuer to buy back bonds before maturity
The issuer has the right to refund the principal before maturity. For a callable bond we calculate the Yield to Call (YTC).

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