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Doubling Option |
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Doubling option A sinking fund provision that may allow repurchase of twice the required number of bonds at the sinking fund call price. Doubling Option A provision in some bond indentures allowing the issuer to repurchase up to twice the number of bonds specified in the indenture's sinking fund provision. That is, the doubling option allows the issuer to redeem a large number of bonds prematurely. The redemption occurs at face value, or close to it. The issuer usually exercises the doubling option when interest rates are low and it can re-issue the same bonds at less expense to itself. The doubling option reduces the return for investors.
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