A callover price is the price of something decided during a ring trading session. Ring trading is when traders meet in person to buy and sell things. They shout out prices until everyone agrees on a final price. This final price is called the callover price. The callover price becomes the official price that gets…
A callable swap is a type of swap. Swaps are deals between two groups. They agree to exchange, or “swap”, one thing for another in the future. Often what they swap is cash flows. Cash flows are money that comes in or goes out. The two main types of cash flows in a swap are…
A callable bond is a special kind of bond. The company or government that issued the bond can “call” it. This means they have the right to pay back the money they borrowed early, before the bond is supposed to mature. Why would they want to do this? Let’s say the bond has a high…
A callable asset swap is a special type of financial product. It is made up of two main parts: The callable swap part lets the seller buy back the bond later if they want to. They can buy it back for a set price. This set price is called the strike credit spread. How does…
A call spread is something people do with stock options. It’s when you buy one kind of option called a “call” and sell another kind of call option at the same time. The two call options you get have the same expiration date. That means they both end on the same day. But here’s the…
Call risk is a thing that can happen with some bonds. A bond is when a company or the government borrows money from people and pays them back later with extra money called interest. Some bonds have a special thing called a “call”. This means the company that made the bond can decide to pay…
A call provision is part of a bond agreement. It says when and how the bond issuer can “call” (pay back early) the bond before it is due. The call provision is important because it affects the bond’s value and how risky it is for investors. Key parts of a call provision The call provision…
Call protection is something that can be part of a bond. A bond is when someone lends money to a company or government. The company or government agrees to pay back the money later, plus extra money called interest. Sometimes the company or government that made the bond might want to pay back the money…
The call price is the amount of money a company pays to investors when it buys back its callable bonds before they mature. Callable bonds are a type of bond that the issuing company can “call” or redeem early. The call price is also known as the redemption price. How Call Price Works When a…
A call premium refers to two different but important concepts in financial markets. These concepts exist in bond markets and options trading. Understanding both types helps investors make better financial decisions. Call Premium in Bond Markets Understanding Bond Call Premiums The bond call premium represents extra money an investor receives when a company redeems their…
