Callable securities usually benefit the issuer over the buyer of the asset.

Question

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Callable securities give the issuer the right to redeem the security before its maturity date, often at a predetermined price. This can be advantageous for the issuer, especially if interest rates fall, allowing them to refinance at lower rates. However, this feature can be less beneficial for the buyer, as it limits their potential gains and introduces uncertainty regarding the investment's yield.

Callable Securities Usually Benefit the Issuer Over the Buyer of the Asset