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extendable bond

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Financial Dictionary

Extendable Bond

A bond issue with a maturity that can be extended to a longer period at the option of the issuer.

Investopedia Commentary

If interest rates are higher at maturity (than they previously were before) then the issuer is more likely to try and extend the bond.

Related Links

Bond Basics Tutorial

See also: Bond, Issuer, Maturity

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Financial Dictionary

extendable bond

A long-term debt security that permits the owner to extend the maturity such that interest payments continue and the principal repayment is delayed beyond the original date. This relatively rare type of bond works to the advantage of investors during periods of declining interest rates.

Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
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