Introduction to Convertible Bonds
Convertible bonds consist of the bonds that are easily converted into the stocks. These convertible bonds are issued by the company and like any other normal bonds it has maturity date and face value. The convertible bondholder has all the rights of converting the bond into the predetermined share numbers of the respective company in an identified period. The factors influencing the bondholder converting or not depend on the stock interest rates and prices.
Contract conditions and Payoffs
The convertible bonds market conditions are not standardized and hence making it differ depending on every contract case. The maturity date being one of the ...
