Common use of Callable Bonds Clause in Contracts

Callable Bonds. Callable bonds provide the issuer with the option to redeem them before maturity. This allows the issuer to refinance if interest rates fall and issue new bonds at a low- er, more favorable rate. Issuers generally must pay a slightly higher rate of interest for this privilege. If a security is called prior to maturity, it may affect the yield you receive. Please consult with your Financial Advisor for additional information.

Callable Bonds. Callable bonds provide the issuer with the option to redeem them before maturity. This allows the issuer to refinance if interest rates fall and issue new bonds at a low- erlower, more favorable rate. Issuers generally must pay a slightly higher rate of interest for this privilege. If a security is called prior to maturity, it may affect the yield you receive. Please consult with your Financial Advisor for additional information.pay