Definition
convertible
Convertible - Convertibles are the corporate securities,
usually preferred shares or bonds, that can be exchanged
for a set number of another form, usually common
share, at a pre-stated price. Convertibles are appropriate
for investors who want higher income than is available
from common stock, together with greater appreciation
potential than regular bonds offer. From the issuer's
standpoint, the convertible feature is usually designed
as a sweetener, to enhance the marketability of
the stock or preferred.
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Private Equity and Venture Capital Glossary
