I have a bond and would like to know whether its possible to set something similar to a stop order, i.e. That you make an order to sell the bond if the bond price reaches a specified low value?

My stock broker informed me that this can only be done with stocks and not bonds whether I don't see the reason why it wouldn't be available for bonds as well?

They informed me that the order which can be made with a bond is to sell at a price (or better), which I don't want.. as if it is better, I want to keep the bond as it has a good coupon


The bond in question would need to have a put provision, defined as follows:

A condition that allows a bondholder to resell a bond back to the issuer at a price - which is generally par - on certain stipulated dates prior to maturity. The put provision is an added degree of security for the bondholder, since it establishes a floor price for the bond. This mitigates the risk of a decline in the bond price in the event of adverse developments such as rising interest rates or a deterioration in the credit quality of the bond issuer.


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