Latest / How Canadian Markets Work
Episode 44: Bonds with Options Attached
Got something to say to this podcast? Send a voicemail, and you might hear yourself on the next episode!
Episode Summary If two bonds have the same issuer, maturity, and credit rating, but one offers a higher yield, there is always a catch. This episode breaks down the golden rule of embedded options: "whoever holds the option pays for it". We explore callable, retractable, and convertible bonds, how options alter traditional price sensitivity, and why the yield you see is often not the yield you will actually receive.
Key Concepts
Callable Bonds: These grant the issuer the right to redeem…
The skinny
The skinny isn't ready yet — notes appear once the transcript is processed.