Bond option


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Bond option

An option to buy or sell a bond by a particular date at a fixed price.

Bond Option

An option to buy or sell (depending on whether it is a call or a put) a bond at a certain price on or before the expiry date. One buys a call bond option if one believes that interest rates will fall, causing an increase in bond prices. Likewise, one buys a put bond option if one believes that the opposite will be the case. See also: Stock option.
References in periodicals archive ?
Friday's expiration of April Treasury bond options, she said, did not add any volatility to the session.