Free Version

Review Topics
Practice Exams
Stay calm. You don't want to be the one freaked-out buffalo who starts a stampede. You'll be ribbed for weeks.

Convertible Bonds

Willy tries to bring Facebook’s wily CFO and board back to reality a half step--and does so--by opening the door to the magical wonderland called convertible bonds. Convertible bonds are just bonds with an embedded call option in them to convert the bonds into equity, aka shares of stock in a given company. 

Willy explains the dynamics of convertibles into FB equity shares. If “market” for a vanilla debenture (low end bond) is 8%ish, the way that Mark can get to a 4% kind of interest tab is ...

Looking for more? Why is this annoying box in the way? It's because you haven't paid for the course yet!

Next: Funded Debt
Prev: Closed vs. Open Ended Terms

*Securities is a registered trademark of the College Board, which was not involved in the production of, and does not endorse this product.