Question: This excerpt is taken from an article titled Caywood Looks

This excerpt is taken from an article titled “Caywood Looks for Convertibles,” which appeared in the January 13, 1992, issue of BondWeek, p. 7:
Caywood Christian Capital Management will invest new money in its $400 million high-yield portfolio in “busted convertibles,” double- and triple-B rated convertible bonds of companies. . . ., said James Caywood, CEO. Caywood likes these convertibles as they trade at discounts and are unlikely to be called, he said.
(a) What is a busted convertible?
(b) What is the premium over straight value at which these bonds would trade?
(c) Why does Mr. Caywood seek convertibles with higher investment-grade ratings?
(d) Why is Mr. Caywood interested in call protection?

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  • CreatedAugust 22, 2015
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