articleBlog Post Posted on: 10/04/2021

What Makes Convertible Bonds Popular?

Josh Schaeffer, PhD

Convertible bonds offer a remarkable compromise between debt and equity financing. By offering a lower cost of debt, they provide a benefit to companies, while investors are drawn to the potential upside. These notes are especially popular for growth companies and high volatility situations. In this video from Kaplan’s Financial Management Network,* Josh Schaeffer discusses the features of convertible bonds, some of their uses, accounting principles, and examples of successful usages of these financing instruments. Watch the video here:

What Makes Convertible Bonds Popular

* The video content and production was created by Athina Koutsoumadi, content manager and producer for the Financial Management Network (FMN) offered by Kaplan Financial Education.  FMN is a subscription based program that offers four monthly CPE & CPD accredited segments on hot topics, geared towards C-suite executives of Fortune 500 companies.  For more information visit https://lnkd.in/emjfaZ2.

Related Content

articleBlog Post

In a Crisis, Convertible Bonds Can Be an Attractive Way to Raise Cash

Convertible bonds are debt instruments that promise a specific cash flow stream. In today’s economy, they offer a unique value proposition. Here’s why.

Read More
mimoWebcast

Converts in a Crisis: Understanding the Role of Convertible Securities in a Volatile Economy

In this webcast, we focus on different types of convertible securities and discuss their increased effectiveness in times of economic turmoil.

Watch Now
descriptionIssue Brief

Diluted EPS for Convertible Debt Securities: A Primer

Convertible securities can be an attractive source of capital for mature and early-stage companies alike. But their dilutive impact is a potentially complicated issue. In this issue brief, we take a closer look at that impact and introduce the “if-converted method” as an elegant way to determine the dilutive impact of convertibles. 

Read More
descriptionIssue Brief

Design Features that Drive the Fair Value of a Convertible Security

Convertible debt combines features of debt and equity. Find out why companies issue it and how the terms you choose can dramatically affect the instrument’s valuation.

Read More