What is a convertible bond fund?
Convertible bond fund refers to the fund used to invest in convertible bonds, which is also called convertible fund.
Convertible bonds are bonds that can be converted into stocks. When converted into stocks, convertible bonds will have a conversion price. If the positive share price is higher than the conversion price, investors can get income, so the income from investing in convertible bonds is related to the fluctuation of the positive share price. In addition, investors can also buy and sell convertible bonds in the secondary market. Compared with stocks, the trading of convertible bonds is more flexible, including no price limit and T+0 trading. Compared with direct investment in convertible bonds, convertible bond funds reduce the risk of large fluctuations through portfolio investment.
Convertible bonds are actually a capital preservation investment, because investors can also invest in convertible bonds according to bonds. When the convertible bonds expire, investors can exchange principal and interest with listed companies according to the face value of the convertible bonds plus interest.
At present, it is quite hot to play new convertible bonds in the market. Compared with playing new shares, the advantage of playing new convertible bonds is that there is no threshold.