Convertible Bond

From Open Risk Manual


Convertible Bond. Bond that gives the holder the right to convert the bond into a fixed number of shares (conversion ratio) if the equity price rises above a specified level (strike price)

If the equity price remains below the strike price throughout the term of the bond it matures and is redeemed like a regular bond. The conversion ratio and strike price are usually set when the convertible bond is issued.


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Facts about "Convertible Bond"
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