Reinvestment risk. If investors hold a callable bond, when the interest rate goes down, the issuer may redeem the bond before maturity. If this happens investors have to re-invest the proceeds, the yields on other bonds in the market will generally be less favorable.
Reinvestment risk. The risk of loss from reinvesting principal or income at a lower interest rate. Suppose you buy a bond paying 5%. Reinvestment risk will affect you if interest rates drop and you have to reinvest the regular interest payments at 4%. Reinvestment risk will also apply if the bond matures and you have to reinvest the principal at less than 5%. Reinvestment risk will not apply if you intend to spend the regular interest payments, or the principal, at maturity.
Reinvestment risk. 4.2.5.1 For callable bonds, if the issuer redeems the bonds before the maturity date, and you reinvest the recovered principal in other bonds with similar risk feature, the return may be lower than the original bond investment.
Reinvestment risk. If your CD is paid prior to maturity as a result of the issuing Insured Institution’s insolvency or a voluntary early withdrawal (see Section 3(h) above, “Additions and Early Withdrawal”), you may not be able to reinvest your funds at the same interest rate that you received on the original CD. Neither we nor Promontory is responsible to you for any losses you may incur as a result of a lower interest rate on an investment replacing your CD.
Reinvestment risk. If you cannot reinvest the future interest incomes generated from a bond at the prevailing interest rate when the bond was initially purchased, the rate of the return (yield-to-maturity) of the bond will be affected.
Reinvestment risk. This risk arises from the uncertainty in the rate at which cash flows from an investment may be reinvested. This is because the bond will pay coupons, which will have to be reinvested. The rate at which the coupons will be reinvested will depend upon prevailing market rates at the time the coupons are received.
Reinvestment risk. If the Client applies for early redemption or the issuer exercises its right of early redemption, and reinvests the proceeds from the early redemption, the investment return may be lower than the yield of this product.
Reinvestment risk. If the issuing institution exercises the right to redeem this product early, The Client will face reinvestment risk.
Reinvestment risk. You may have proceeds of the CABs to invest prior to the time that you are able to spend those proceeds for the authorized purpose. Depending on market conditions, you may not be able to invest those proceeds at or near the yield on the CABs, which is referred to as “negative arbitrage.”
