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1. What is convertible bond?
1. Convertible bonds are all called convertible corporate bonds, which refer to bonds that bondholders convert into common shares of the company at the agreed price at the time of issuance.
2. Convertible bonds have three characteristics: creditor's rights, equity and convertibility, so convertible bonds are more flexible, which is a good way for listed companies to broaden financing channels.
2. When is it appropriate to sell convertible bonds?
1. Convertible bonds can be renewed like new shares, and the selling time after the lottery is the same as the stock lottery. The selling time depends on the market situation.
2. Under normal circumstances, the price of new bonds will rise on the first day of listing, so many investors will choose to sell their convertible bonds on the day of listing, thus gaining income.
3. Although convertible bonds may continue to rise after listing, there is also the possibility of price decline. If there is no certain judgment on the future trend of convertible bonds, it is safer to sell them on the first day of listing.
3. What should I pay attention to when investing in convertible bonds?
1, the stock price fluctuates greatly.
Investors of convertible bonds must be prepared for frequent stock price fluctuations, because the issuance of convertible bonds was originally sold to the issuer at the established issue price, so the stock price fluctuated greatly.
2. There is a risk of interest loss.
Once the stock price falls below the conversion price, it is likely that convertible bond investors will become bond investors. It can be seen that the volatility of convertible bonds will be great, and the interest rate will be lower than that of ordinary bonds, which will easily cause interest losses for investors.
3. There may be early redemption.
After the issuance of convertible bonds, if the stock price is very high for a period of time, triggering the compulsory redemption clause, the listed company has the right to redeem all or part of the unconverted convertible bonds at a price slightly higher than the face value of convertible bonds. Once redeemed in advance, it will limit the highest income that investors can get.