Put Bond

A A A

DEFINITION

A bond that allows the holder to force the issuer to repurchase the security at specified dates before maturity. The repurchase price is set at the time of issue, and is usually par value.

INVESTOPEDIA EXPLAINS

Bondholders have the option of putting bonds back to the issuer either once during the lifetime of the bond (known as a one-time put bond), or on a number of different dates. Of course, the special advantages of put bonds mean that some yield must be sacrificed.

This type of bond is also known as a multimaturity bond, an option tender bond, a variable rate demand obligation (VRDO).


RELATED TERMS
  1. Par Value

    The face value of a bond. Par value for a share refers to the stock value stated ...
  2. Putable Common Stock

    Common stock that gives investors the option to put the stock back to the company ...
  3. Discount Bond

    A bond that is issued for less than its par (or face) value, or a bond currently ...
  4. Callable Bond

    A bond that can be redeemed by the issuer prior to its maturity. Usually a premium ...
  5. Eurobond

    A bond issued in a currency other than the currency of the country or market ...
  6. Convertible Bond

    A bond that can be converted into a predetermined amount of the company's equity ...
  7. Coupon Bond

    A debt obligation with coupons attached that represent semiannual interest payments. ...
  8. Maturity Date

    The date on which the principal amount of a note, draft, acceptance bond or ...
  9. Bond

    A debt investment in which an investor loans money to an entity (corporate or ...
  10. Premium Bond

    1) A bond that is trading above its par value. A bond will trade at a premium ...
Related Articles
  1. What does it mean when a bond has a ...
    Investing

    What does it mean when a bond has a ...

  2. Bond Basics Tutorial
    Retirement

    Bond Basics Tutorial

  3. Questions For U.S. Stock ETF Bulls
    Economics

    Questions For U.S. Stock ETF Bulls

  4. Has Stock Bias Affected Your ETF Asset ...
    Bonds & Fixed Income

    Has Stock Bias Affected Your ETF Asset ...

  5. Mortgage Rates To Rise, But When And ...
    Investing Basics

    Mortgage Rates To Rise, But When And ...

  6. Your Three-Step Municipal Bond Workout
    Investing

    Your Three-Step Municipal Bond Workout

  7. Four Ways to Increase Your Corporate ...
    Bonds & Fixed Income

    Four Ways to Increase Your Corporate ...

  8. Why Schlumberger Is A Name You Should ...
    Stock Analysis

    Why Schlumberger Is A Name You Should ...

  9. How Visa Counts On Your Free-Spending ...
    Stock Analysis

    How Visa Counts On Your Free-Spending ...

  10. Don’t Fight The Fed? Don’t Fight The ...
    Mutual Funds & ETFs

    Don’t Fight The Fed? Don’t Fight The ...

comments powered by Disqus
Hot Definitions
  1. Cash and Carry Transaction

    A type of transaction in the futures market in which the cash or spot price of a commodity is below the futures contract price. Cash and carry transactions are considered arbitrage transactions.
  2. Amplitude

    The difference in price from the midpoint of a trough to the midpoint of a peak of a security. Amplitude is positive when calculating a bullish retracement (when calculating from trough to peak) and negative when calculating a bearish retracement (when calculating from peak to trough).
  3. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  4. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  5. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  6. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
Trading Center