
- UID
- 223317
- 帖子
- 277
- 主题
- 141
- 注册时间
- 2011-7-11
- 最后登录
- 2016-4-19
|
bond market structure question
Why would a bond with an embedded call option ever trade at a premium to a non call able bond with same coupon, maturity etc? The only time I could see is if rates were below the coupon and for some reason the bond hadn’t been called and rates moved up. THen it would outperform a ncb bond. Still dont see why it would trade at a premium though. The scarcity argument doesnt make sense to me at least for bonds with embedded call options. |
|