Read this in an investor letter "the issuance of a 20-year bond (callable beginningin year 10 and at par by year 15)."
What exactly does this mean? How does a bond get to par before its maturity date? How does it trade before/after that?
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Starting at the call date the issuer can redeem the bond. The call value typically has a higher value the earlier it's called. So at 10 years it could be called at 102 and at 15 year — at par, 100.
Does it remain at par for every year after 15?
Does it trade at a price the market deems up until market 15? So any point below par and it draws closer to par since the issuer can redeem it at par?
Is it saying it is callable, but not at par at year 10? What price would that be then?
I guess my confusion is about if the market (supply/demand) is what determines price, how could it certainly trade at par by a certain date.
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