Convertible Bonds: Variations

Convertible Bonds: Variations

Intuition Publishing Pty Ltd
Updated Sep 24, 2020

There are many variations on the conventional convertible bond structure and we cover the main ones here. We explain the structure of contingent convertibles (CoCos), and what they mean for the issuer. We then discuss discount, zero-coupon, and exchangeable bonds from the point of view of the investor and the issuer. We finish with a brief description of four other variants, mandatory convertibles, busted convertibles, synthetic convertibles, and convertibles with reset features.