Warning: Creating default object from empty value in /hermes/bosnacweb04/bosnacweb04ai/b1550/ipg.lantanasolutionsbh98965/fincyclopedia/wp-content/plugins/independent-core/admin/ReduxCore/inc/class.redux_filesystem.php on line 29 Busted Convertible – Fincyclopedia
[wpdreams_ajaxsearchpro id=44 ]
  • Monday, April 28, 2025
  • The Financial Encyclopedia
[wpdreams_ajaxsearchpro id=43 ]

Finance

  Finance   |   Terms
  • 608
  • March 3, 2022
[addtoany]
Notice: Undefined variable: myString in /hermes/bosnacweb04/bosnacweb04ai/b1550/ipg.lantanasolutionsbh98965/fincyclopedia/wp-content/themes/independent/template-parts/post/content-single.php on line 41

Busted Convertible

A convertible bond (CB) whose value is pulled down by a declining stock (its potential equity participation). In other words, the upside return potential (equity conversion option) of the bond loses value and becomes more out-of-the-money. Busted convertible bonds usually sell as straight bonds (since they provide the holder with very little equity participation). The bond equity component drops substantially below conversion price and it trades on or near bond value, usually with a high conversion premium (at a premium of 100% over its conversion value).


[related_posts_by_tax title="See also" posts_per_page="10" taxonomies="post_tag"]

[pt_view id=473cba234b]
[su_box title="Watch on Youtube" style="soft" box_color="#f5f5f5" title_color="#282828" radius="2" class="" id=""][su_row class=""][su_column size="1/1" center="yes" class=""] [/su_column][/su_row][/su_box]

Latest Terms

Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments

    Leave Your Comment

    Your email address will not be published.*