Your English writing platform
Discover LudwigSuggestions(1)
Exact(14)
The company also sold $250 million of mandatory convertible securities, paying 9.5percentt per year and with a conversion premium of 18percentt.
With its 60percentt conversion premium, he calculated that the bond would rise 26percentt if the stock, which traded at one point last week at $59.69, rose 50percentt.
With the common at $57.50, your conversion premium is 25%.
In other words the conversion premium is 85%.
When the company is a winner, you see a shrinking of the conversion premium.
Teco preferred sells at $26, for a current 4% to 18% conversion premium.
Similar(44)
Busted convertibles are riskier bonds with double-digit yields and steep conversion premiums.
They hope that higher conversion premiums will ease the concern of existing shareholders that a supply of new shares in future will dilute existing holdings.
The latest batch comes with conversion premiums of up to 38% above the current share price, a long way from once-normal levels of 2-3%.
At the moment, conversion premiums are low.
Because people wrongly view preferreds as less safe than bonds, the preferreds tend to have better yields and lower conversion premiums.
Write better and faster with AI suggestions while staying true to your unique style.
Since I tried Ludwig back in 2017, I have been constantly using it in both editing and translation. Ever since, I suggest it to my translators at ProSciEditing.

Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com