Definition of Convertible Arbitrage
What is Convertible Arbitrage
Convertible arbitrage involves buying a convertible security and short-selling its underlying stock. An investor or trader who engages in convertible arbitrage is attempting to take advantage of the difference between the bond’s conversion price and the current price of the shares in the underlying company.
Glossary of Terms and Phrases
A financial dictionary or glossary is an essential tool to better understand the meaning of a specialized term or phrase. It would obviously make life much easier if everyone spoke the same language and used the same financial terms and phrases but that is not realistic.
We learn new languages to communicate with each other, transact business globally and to appreciate other cultures. Global finance is a specialized language that if understood and mastered, it will provide benefits that help to decrease risk and improve investment returns. Financial literacy is the foundation of developing good investment strategies and sound decision making.
Related Investment Terms
Forex
Hedge Fund
Merger
