I. Preparations before Convertible Bonds are converted into shares
1. Convertible bonds can only be converted during the conversion period. At present, the conversion period of convertible bonds traded in the market is generally 6 months after the issuance of convertible bonds to the maturity date of convertible bonds. You can convert shares on any trading day during this period.
Convertible bonds don't need to be converted into shares at any cost, so you don't need to prepare additional funds for conversion in your account.
3. Pay special attention to the fact that convertible bonds generally have early redemption clauses. Investors holding convertible bonds should pay close attention to this. When the company issues a redemption announcement, they should convert shares in time or sell convertible bonds directly, otherwise they may suffer huge losses. Because companies generally only redeem all unconverted bonds with a very small margin (generally not exceeding 105 yuan), and convertible bonds that meet the redemption conditions are generally above 130 yuan, and some even reach as high as 200 yuan! In August 2007, investors including three fund companies failed to convert their shares in time, resulting in a total loss of more than 20 million yuan!
4. The total face value of convertible bonds applied for conversion must be an integer multiple of 1 1,000 yuan. The final shares obtained by applying for share conversion are integer shares. When the mantissa is less than 1 share, the company will pay in cash within 5 trading days after the conversion date. The redemption amount is the number of shares after the decimal point multiplied by the conversion price. For example, if the remaining 0.88 shares are converted into 5 yuan, the redemption amount is 0.88*5=4.4 yuan.
Two. Specific operation methods of convertible bonds into shares
The procedures for converting convertible bonds into shares in Shanghai and Shenzhen stock markets are quite different, and there are several methods each.
1. Shanghai market
1) On the securities trading page, enter the conversion code (be careful not to enter the conversion code, otherwise it will become a trading transaction), and then enter the number of shares to be converted (the system will automatically display 100 yuan without filling in the stock price). In some brokerage interfaces, entrusted buying is also acceptable. This is because, as long as you enter the following share conversion code, the system defaults to the right to exercise share conversion.
2) Share conversion at the brokerage counter or telephone, as above.
Note: once the Shanghai market is successfully commissioned, the order cannot be withdrawn!
2. Shenzhen market
1) Securities companies exchange shares over the counter (most securities companies require that they can only exchange shares over the counter). You need to bring your ID card and shareholder card and fill in the form at the counter where you open an account to apply for share conversion.
2) Some brokers support online share conversion, such as Galaxy Securities and Hongyuan Securities. Method: On the securities trading page, select share conversion and resale in other businesses (the interface of each broker may be different, please consult your broker if you have any questions). The operation method is "Convertible bonds into shares", and then enter the convertible bond code (Shenzhen Stock Exchange bonds have no conversion code) and the number of shares to be converted. Orient securities's stock conversion method: choose bond conversion-bond conversion code (translated from the speech of netizen gross, this website has not verified). The specific operation diagram is as follows (Galaxy Securities interface):
Note: After the Shenzhen Stock Exchange is entrusted through the Internet, the order cannot be withdrawn!
3) Some brokers support telephone share conversion, such as Everbright Securities. Operation process: 1 buy, 2 sell, 3 cancel the order, 4 debt-to-equity swap. Press 4 to convert debt into equity, and enter the code and quantity of convertible bonds.
Note: Regarding the number of shares converted, the pages of various brokers may be different, some are "hands" and some are "sheets". 1 hand = 10 sheets. That is, if you have convertible bonds with a face value of 65,438+0,000 yuan, some brokers require you to fill in the amount of 65,438+0 (hands), while others need to fill in 65,438+00 (sheets). Practice according to the interface of brokers.
Three. Transactions before and after convertible bonds are converted into shares.
Convertible bonds are subject to T+0 trading, that is, convertible bonds bought on the same day can be sold on the same day; Convertible bonds bought on the same day can be converted into shares before the market closes on the same day (note that it is generally successful to enter the number of shares to be converted at this time, because the setting of securities firms may show that the number of shares to be converted is 0). After 9: 00 p.m. or the next morning, the convertible bonds disappear, and the convertible bonds appear, and the shares can be sold the next day (T+ 1).
Convertible bond trading skills: Some brokers can still sell convertible bonds after you entrust them to convert shares. If your convertible bonds are not sold or only part of them are sold after the market closes, the rest can still be automatically converted into shares.
4. Which is more advantageous, directly selling convertible bonds or debt-for-equity swaps?
This can be simply calculated (or refer to the following "real-time market discount premium rate of convertible bonds, green means it is more beneficial to sell convertible bonds directly). If the convertible bond price is 130 yuan, the conversion price is 5 yuan and the corresponding stock price is 6 yuan. The number of shares converted for each convertible bond is 65,438+000/5 = 20 (if it is not an integer share, the balance will be paid in cash), and the corresponding conversion value is 20 shares *6 yuan = 65,438+020 yuan. Obviously, the conversion is a loss, so it is better to sell the convertible bonds directly at 130 yuan.
Generally speaking, it is more beneficial to sell convertible bonds directly than to convert them during the conversion period. Otherwise, a large number of investors will buy convertible bonds first, then convert them into stocks immediately, and then throw them out for risk-free arbitrage the next day. However, for retail investors and institutional investors who hold a large number of shares, they may also choose to convert shares at a loss, because convertible bonds are generally inactive, and selling convertible bonds directly will greatly lower the price of convertible bonds. Of course, sometimes convertible bonds will also have arbitrage opportunities, which may be an opportunity for companies to deliberately arbitrage investors, so that convertible bonds can be converted into shares earlier, so that companies do not have to pay interest on convertible bonds every year.