RT Journal Article
SR Electronic
T1 Putable/Callable/Reset Bonds
JF The Journal of Derivatives
FD Institutional Investor Journals
SP 88
OP 93
DO 10.3905/jod.1999.319132
VO 6
IS 4
A1 Andrew J. Kalotay
A1 Leslie A . Abreo
YR 1999
UL https://pm-research.com/content/6/4/88.abstract
AB A callable bond will be paid off before maturity if the issuer finds the interest rate environment favors that strategy. But a putable bond may experience the same fate, at the option of the bondholder. Combining both call and put features in a single bond creates enough contingencies that quite different-seeming instruments may actually be essentially the same. This article examines such a structure and shows both how it behaves and why the ability to take it apart and effectively sell off some of the components as stand-alone options can make it particularly attractive to an issuer.