Hello, convertible bonds, that is, "convertible corporate bonds", mean that within a specified period, investors can convert the convertible bonds they hold into shares of the company.

The convertible bond itself has the attributes of both bonds and stocks. When it is a bond, the investor's principal is 100% guaranteed. When the bond matures, the company is required to repay the principal and interest; when it becomes a stock, the investor's principal is 100% guaranteed.

Investors enjoy the high returns it brings.

Therefore, convertible bonds are also considered to be "guaranteed at the bottom but not capped at the top."

Convertible bonds have the characteristics of both bonds and stocks, and have the following three characteristics: (1) Creditor's rights.

Convertible bonds have specified interest rates and terms, and investors can choose to hold the bonds until maturity and receive principal and interest.

(2) Equity.

Convertible bonds are pure bonds before they are converted into stocks, but after being converted into stocks, the original bond holders change from creditors to shareholders of the company and can participate in the company's business decisions and dividend distribution, affecting the company to a certain extent.

share capital structure.

(3) Convertibility.

Convertibility is an important symbol of convertible bonds, and bondholders can convert the bonds into stocks according to agreed conditions.

Equity conversion is an option enjoyed by investors that is not available in ordinary bonds.

Convertible bonds clearly stipulate when they are issued that bondholders can convert the bonds into ordinary shares of the company at the price agreed upon at the time of issuance.

The interest rate of convertible bonds is generally lower than the interest rate of ordinary corporate bonds. The issuance of convertible bonds by enterprises can reduce financing costs.