Assume you bought a convertible bond two years ago for $900. The bond has a conversion ratio
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Would you have been better of off you (a) had bought the stock directly or (b) bought the convertible bond and eventually converted it to common stock? Assume you would have invested $900 in either case. Disregard taxes, commissions, and so forth. (Hint: Consider appreciation in value plus any annual income received. See Table 13-3 on page 346 for an example.)
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
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Fundamentals of Investment Management
ISBN: 978-0078034626
10th edition
Authors: Geoffrey Hirt, Stanley Block
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