The majority of corporate bonds are callable before maturity at the option of the issuer. Unlike other security options (warrants, convertible bonds, etc.), the call provision cannot be resold; its value can be realized only by exercising it. The problem is to choose the optimal time to perform refunding (including the alternative of not refunding before maturity).
No takes yet. Share an insight, caveat, or question.
Alan Kraus (1973) studied this question.
Synapse has enriched 5 related papers. Consider them for comparative context: