convertible security

A security that, at the holder's option, may be exchanged for another asset, typically a fixed number of shares of common stock.

American Heritage® Dictionary of the English Language, Fifth Edition. Copyright © 2016 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

ThesaurusAntonymsRelated WordsSynonymsLegend:

Noun

convertible security - a corporate security (usually bonds or preferred stock) that can be exchanged for another form of security (usually common stock)

convertible

certificate, security - a formal declaration that documents a fact of relevance to finance and investment; the holder has a right to receive interest or dividends; "he held several valuable securities"

Mentioned in

References in periodicals archive

conversion price (the price per share at which an exchangeable bond can be exchanged for a common stock), conversion ratio (a number of common stock that at maturity can be exchanged for a bond) and conversion period (the time during which an exchangeable security can be converted into the common stock).

The use of exchangeable bonds during the privatization process

We were able to identify 104 transactions covering the period 1981 through 2001 that satisfy the following selection criteria: the exchangeable security payoff issued by the issuer depends on the stock of the underlying company; the underlying stock is publicly traded; the payoff can be made in the shares of underlying stock or in cash tied to the performance of underlying stock; the issuer has an ownership stake in the underlying stock prior to the announcement of the exchangeable issue; and the exchangeable debt is not used as payment to the underlying company in a merger.

When do firms issue exchangeable debt?

All content on this website, including dictionary, thesaurus, literature, geography, and other reference data is for informational purposes only. This information should not be considered complete, up to date, and is not intended to be used in place of a visit, consultation, or advice of a legal, medical, or any other professional.