Putable Bond Price Solution

STEP 0: Pre-Calculation Summary
Formula Used
Putable Bond Price = Non Putable Bond Price+Put Option Price
PBP = NPBP+POP
This formula uses 3 Variables
Variables Used
Putable Bond Price - Putable Bond Price is the price at which a bondholder can sell the bond back to the issuer before maturity, influencing its market value.
Non Putable Bond Price - Non Putable Bond Price refers to the market value of a bond that does not grant the bondholder the right to sell the bond back to the issuer before maturity.
Put Option Price - Put Option Price is the expense or worth of the right to sell an underlying asset at a predetermined price (strike price) within a specific timeframe (expiration date).
STEP 1: Convert Input(s) to Base Unit
Non Putable Bond Price: 85.5 --> No Conversion Required
Put Option Price: 4.5 --> No Conversion Required
STEP 2: Evaluate Formula
Substituting Input Values in Formula
PBP = NPBP+POP --> 85.5+4.5
Evaluating ... ...
PBP = 90
STEP 3: Convert Result to Output's Unit
90 --> No Conversion Required
FINAL ANSWER
90 <-- Putable Bond Price
(Calculation completed in 00.004 seconds)

Credits

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Created by Keerthika Bathula
Indian Institute of Technology, Indian School of mines, Dhanbad (IIT ISM Dhanbad), Dhanbad
Keerthika Bathula has created this Calculator and 50+ more calculators!
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Verified by Aashna
IGNOU (IGNOU), India
Aashna has verified this Calculator and 25+ more calculators!

14 Fixed Income Securities Calculators

Accrued Interest
​ Go Accrued Interest = (Face Value*Total Annual Coupon Rate*Days since Last Payment Date)/(Number of Coupon Payments per Year*Accrual Period)
Conversion Premium
​ Go Conversion Premium = Conversion Value-Market Price of Convertible Bond
Conversion Ratio
​ Go Conversion Ratio = Par Value at Maturity/Conversion Price of Equity
Convexity Adjustment
​ Go Convexity Adjustment = Bond's Convexity*(Change of Yield^2)*100
Callable Bond Price
​ Go Callable Bond Price = Non Callable Bond Price-Call Option Price
Nominal Yield
​ Go Nominal Yield = (Total Annual Interest Payments/Face Value)*100
Expected Loss
​ Go Expected Loss = Default Probability*Loss Severity given Default
Putable Bond Price
​ Go Putable Bond Price = Non Putable Bond Price+Put Option Price
Conversion Value
​ Go Conversion Value = Market Price per Share*Conversion Ratio
Floating Interest Rate
​ Go Floating Interest Rate = Reference Rate+Fixed Spread
Dirty Price
​ Go Dirty Price = Clean Price+Accrued Interest
Clean Price
​ Go Clean Price = Dirty Price-Accrued Interest
Semi Annual Bond Equivalent Yield
​ Go Semi Annual Bond Equivalent Yield = Yield per Semi Annual Period*2
Loss Severity
​ Go Loss severity = 1-Recovery Rate

Putable Bond Price Formula

Putable Bond Price = Non Putable Bond Price+Put Option Price
PBP = NPBP+POP

What is Putable Bond Price ?

A putable bond price represents the market value of a bond that provides the bondholder with the option to sell the bond back to the issuer before its maturity date. This feature gives investors added flexibility and protection against adverse market conditions or changes in interest rates. If market interest rates rise significantly, the bondholder can exercise the put option and sell the bond at the predetermined put price, which is typically par value or a specified price agreed upon at issuance. This ability to sell the bond at a set price mitigates the downside risk for investors and may result in a higher initial bond price compared to non-putable bonds with similar characteristics. However, the presence of a put option can also affect the bond's liquidity and trading dynamics, as investors weigh the benefits of the put feature against potential yield adjustments.

How to Calculate Putable Bond Price?

Putable Bond Price calculator uses Putable Bond Price = Non Putable Bond Price+Put Option Price to calculate the Putable Bond Price, The Putable Bond Price refers to the market value of a bond that allows the bondholder to sell it back to the issuer before maturity, influencing its overall value and yield. Putable Bond Price is denoted by PBP symbol.

How to calculate Putable Bond Price using this online calculator? To use this online calculator for Putable Bond Price, enter Non Putable Bond Price (NPBP) & Put Option Price (POP) and hit the calculate button. Here is how the Putable Bond Price calculation can be explained with given input values -> 90 = 85.5+4.5.

FAQ

What is Putable Bond Price?
The Putable Bond Price refers to the market value of a bond that allows the bondholder to sell it back to the issuer before maturity, influencing its overall value and yield and is represented as PBP = NPBP+POP or Putable Bond Price = Non Putable Bond Price+Put Option Price. Non Putable Bond Price refers to the market value of a bond that does not grant the bondholder the right to sell the bond back to the issuer before maturity & Put Option Price is the expense or worth of the right to sell an underlying asset at a predetermined price (strike price) within a specific timeframe (expiration date).
How to calculate Putable Bond Price?
The Putable Bond Price refers to the market value of a bond that allows the bondholder to sell it back to the issuer before maturity, influencing its overall value and yield is calculated using Putable Bond Price = Non Putable Bond Price+Put Option Price. To calculate Putable Bond Price, you need Non Putable Bond Price (NPBP) & Put Option Price (POP). With our tool, you need to enter the respective value for Non Putable Bond Price & Put Option Price and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.
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