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You own a $1,000 face value convertible. Microsoft bond that is currently trading at a price of $1,100. The bond has a conversion ratio of

You own a $1,000 face value convertible. Microsoft bond that is currently trading at a price of $1,100. The bond has a conversion ratio of 20 and Microsoft stock is currently trading at $54 per share. Assuming you are liquidating your position, which option would be more profitable?

Sell the bond

Convert the bond and sell the stock

OR

None of the options

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