interest rate option

(redirected from Interest Option)

Interest Rate Option

An option contract giving the holder to buy (for a call) or sell (for a put) a security with a certain interest rate at a given strike price on or before the expiration date. An interest-rate option is useful to hedge the interest rate risk inherent to portfolios consisting mainly of bonds.

interest rate option

An option contract on interest-bearing securities or on a futures contract on interest-bearing securities. These options are generally used as a means to manage the risk of a bond portfolio.
References in periodicals archive ?
We wish to clarify that Mr Mascarenhas was initially contacted by the Bank on September 2, 2015, and was offered to convert the total outstanding balance of his credit card to an Installment Payment Plan (IPP) with an interest option and not on a zero per cent plan as stated by the customer.
Allianz Life Pro+ Survivor has multiple index allocation options including the S&P 500 Index, a Blended index, and the Barclays US Dynamic Balance Index as well as a fixed interest option. Once indexed interest is credited, it is locked in and the cash value will not decrease due to negative index changes (although fees and expenses will reduce cash value).
Chelsea Building Society also offers a monthly interest option of 3.25% (3.30% AER) for those relying on their savings for income.
A monthly interest option of 3.25 per cent is also available.
Those who prefer a monthly interest option can choose to receive 3.07% gross variable (3.11% AER), and additional deposits can be made up to the maximum balance of pounds 100,000.
International Resource News-June 28, 2011--Greenwood Gold Resources, Inc acquires 100 percent working interest option from Candorado Ltd(C)1994-2011 ENPublishing - http://www.enpublishing.co.uk
The Alliance & Leicester Premier Current Account offers the same in credit interest and 12-month interest option as Abbey, but the overdraft rate returns thereafter to between GBP0.5 per day to GBP5 a month.
There are generally two types of inflation protection: the compound interest option and the simple interest option.
So I turned to this `points of interest option' which usually gives hotels, restaurants, that sort of thing.
Bond Update: Leeds & Holbeck Postal Bond maturing in August 2006 offers 25pc initial capital withdrawal before maturity and pays 4.3pc gross, or 4.05pc on monthly interest option.
A three-year bond offers a guaranteed interest rate of 4.2 per cent, a monthly interest option of 4.05 per cent gross per annum with a rate fixed until August 31, 2006.
an increase in the service charge applicable to the loan to a rate that achieves the same level of concessionality as the Principal Option (the Interest Option);