It is said that
Callable bonds are trade @ a premium over Par
While
Sinking fund strcutures are traded@ a discoutn to Par
Why is that?
Such general statements don’t make a lot of sense; whether they trade at a premium or discount to par will depend on their coupon rates.
However, callable bonds are usually called at a premium, while redemption via a sinking fund provision is at par. All else equal, a callable bond will trade at a premium to a bond with a sinking fund provision.