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A convertible bond has a conversion rate of 2.5 shares of stock per $1000 face value bond. Today, the stock currently trades at $385
A convertible bond has a conversion rate of 2.5 shares of stock per $1000 face value bond. Today, the stock currently trades at $385 per share. Also, the convertible bond is trading at 97.5 percent of the face value. Is it worthwhile for a bondholder of this convertible bond to convert it to the stock? What is the share conversion rate per bond? What is the conversion value?
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Fundamentals of Investments Valuation and Management
Authors: Bradford D. Jordan, Thomas W. Miller
5th edition
978-007728329, 9780073382357, 0077283295, 73382353, 978-0077283292
