Business / Finance / Convertible Bond: A practice, usually of buying a convertible bond and shorting a percentage of the equivalent underlying common shares, to create a positive cash flow position (with expected returns above the riskless rate) in a static environment and benifit from capital appreciation should the convertible's premium. This form of investing is far from riskless and requires constant monitoring. See: Chinese hedge and set-up.
Bond Noun Synonyms: tie(s), shackles, chains, fetters, manacles, handcuffs, trammels, thongs, cord(s), rope(s), restraint(s), constraint(s), check(s), control(s), rein(s)
Bond Verb Synonyms: cement, bind, hold together, stick, cohere
Business / Taxes / Convertible Hedge: When you use a convertible hedge, you buy a convertible bond, which you can exchange under certain circumstances for shares of the company’s common stock. At the same time, you sell short the common MORE
Business / Accounting / Convertible Preferred Stock: Preferred stock that can be converted to common stock at a specified conversion rate. MORE