A slang term for a set of special or exceptional features that are added to ordinary investments or instruments in order to allure investors into holding or buying. For example, an issuer may include put options on bonds, whereby the holder has the right to put the bond back according to specific conditions. Likewise, a company could combine its preference shares with a floating dividend feature which allows the holder to receive dividends at a floating rate (e.g., equal to the 3-month USD LIBOR in effect within the relevant dividend period).
March 17, 2025
