Callable bonds and mortgage backed securities both have prepayment risk.

Name: Callable bonds and mortgage backed securities both have prepayment risk.
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Callable bonds and mortgage backed securities both have prepayment risk. Callable bonds allow the issuer to redeem the bond before its maturity date, which can result in prepayment risk for the investor. Mortgage backed securities are backed by pools of mortgages, which can be prepaid by the borrower, resulting in prepayment risk for the investor.

Callable Bonds and Mortgage Backed Securities Both Have Prepayment Risk