CHAPTER 9 Convertible-Arbitrage Strategy
The convertible-arbitrage strategy thesis is similar to long/short equity or capital-structure arbitrages where the portfolio manager is looking to benefit from the pricing of a company’s convertible bond relative to its common stock.
What is a Convertible Bond?
A convertible bond is a hybrid fixed-income security that has a bond component that pays a coupon, along with an equity component that contains optionality that is linked to a conversion feature. The option portion of the convertible bond allows the holder to exchange the ...
Get Visual Guide to Hedge Funds now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
