Question

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

Answer 1

The correct statement is option C. OAS reflects the credit risk and liquidity risk of the bond over the treasury benchmark rates. Read below about a callable bond.

What is a callable bond?

A callable bond is a type of bond that permits the issuer of the bond to retain the privilege of redeeming the bond at some point before the bond reaches its date of maturity. Consequently, the said point which is basis is 75.

Therefore, the correct answer is option C. OAS reflects the credit risk and liquidity risk of the bond over the treasury benchmark rates.

learn more about callable bond: brainly.com/question/24129882

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