Question

oas on a callable bond is 75 basis points using on-the-run treasuries as benchmark rates. which is correct?

Answer 1

When the callable bond is 75 basis points using on-the-run treasuries as benchmark rates,it implies that the nominal speed is 75bp over the treasury benchmark rates.

What is a bond?

It should be noted that a callable bond is the debt instrument whee the issuer has the right to return the principal of the investor.

Callable bonds are also known as redeemable bonds and they're paid off before the maturity date of the bond by the issuer.

It gives room for companies to pay off their debt early and then get benefit regarding favorable interests.

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