doubling option

Doubling option

A sinking fund provision that may allow repurchase of twice the required number of bonds at the sinking fund call price.

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doubling option

A provision in some indentures that allows the borrower, at his or her option, to retire twice as many bonds as stipulated under a sinking fund requirement. The additional retirements take place at or near par, so that the option is used during periods of low interest rates. Thus, the provision operates to the disadvantage of investors. Compare sinking fund provision. See also call provision.