Investors should be aware that some bonds may trade with a factor that impacts the par and market values of the bond along with the coupon payments.
For instance, a bond may trade with a value factor below 1.00 when it has been partially called/redeemed. Inflation protected US Treasuries (TIPS) will also trade with a value factor that changes throughout its maturity to capture the inflation component.
The last reported value factor will be displayed on a best-efforts basis in the bond’s description window when using the desktop TWS, while also being reflected in the Trade proceeds when previewing an order. It may also be retrieved by creating a custom Flex Query report and including the field for Open Positions -> Principal Adjust Factor.
Investors should ultimately refer to the bond’s prospectus and/or contact the issuer to confirm any features of the bond.