Why does a convertible bond have a lower yield than an otherwise identical bond without the option

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Why does a convertible bond have a lower yield than an otherwise identical bond without the option to convert?

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Fundamentals of Corporate Finance

ISBN: 978-0321818171

2nd Canadian edition

Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford

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Question Posted: Jan 05, 2019 12:48 PM

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Why does a convertible bond have a lower yield than an otherwise identical bond without the option

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The option which is not an obligation to convert the bonds into equity is wo...View the full answer

Fundamentals of Corporate Finance

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