Investors who hold convertible bonds can convert bonds into stocks during the conversion period, or sell convertible bonds directly in the market for realization, or choose to hold bonds at maturity and collect principal and interest. The basic elements of convertible bonds include benchmark stock, bond interest rate, bond term, conversion term, conversion price, redemption and resale terms, etc. Convertible bonds are a mixture of ordinary bonds and options that can be converted into stocks. The difference between the convertible bond price and the benchmark stock price constitutes the value of the implied option.
Investment strategy:
1. Keep high positions, select varieties and hold centralized positions.
Due to the limited risk of convertible bonds, the theoretical income is unlimited, which is especially suitable for holding excellent varieties in heavy positions. In 2005, the convertible bond fund, which lasted for half a year, also proved the effectiveness of this operation idea.
2. The valuation of basic stocks is based on full circulation.
In stock investment, it is necessary to increase the research on "consideration" based on full circulation, and make use of the investment opportunities brought about by the uncertainty of A shares to create good returns.
3. Increase the position ratio of convertible bonds of strong stocks, and balance profitability and security by using market fluctuations.
In the period of market downturn, we should increase the positions of convertible bonds with strong stocks, improve the stocks of convertible bonds by possible conversion price adjustment, optimize the positions of convertible bonds, and balance the profitability and security of convertible bonds.