Understanding Callable Bonds

Very Easy Fixed Income Securities Bond Features

In the context of fixed income securities, different bonds come with distinct features that can influence investor decision-making. One important feature of a bond is its callable provision. Which of the following statements correctly describes a callable bond?

A callable bond can be redeemed by the issuer before the maturity date.

A callable bond guarantees a fixed interest rate until maturity.

A callable bond cannot be sold in the secondary market.

Hint

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