When a bond offering is issued with a put provision, who benefits the most?

A bond offering with a put provision allows the bondholder to sell the bond back to the issuer at a predetermined price before maturity. This feature provides significant advantages to those who do not wish to hold the bond until maturity, as it offers them flexibility and a form of protection against rising interest rates or deteriorating credit quality of the issuer.

Investors who do not want to take the risk of holding the bond for its entire term can exercise the put option, effectively allowing them to exit their investment earlier than anticipated under unfavorable market conditions. This reduces their exposure to potential losses, making the put provision particularly attractive for these investors.

While other investors may have their own preferences, such as those wanting to hold the bond to maturity or seeking high yields, they do not reap the specific benefit of flexibility and security that the put provision gives to those unwilling or unable to hold onto the bond for the long term.