Glossary
- Call (warrant)
- Cancelled order
- Cap (investment and leverage products)
- Capital increase
- Capital market
- Capital reduction
- Capital stock
- Cash dividend
- Cash market
- Cash settlement (warrants)
- Cash settlement price
- Cashflow
- CDAX
- Central bank
- Certificate
- Certificate of renewal
- Changes to the composition of an index
- Chart
- Chart analysis
- Classic All Share
- Clean price
- Clearing
- Close out
- Closed-end fund
- Closing Price
- Coco bond
- Collective custody
- Commercial paper
- Commission
- Commission trading
- Commodity futures
- Commodity futures exchange
- Common gap
- Compliance guidelines
- Conditional capital increase
- Consumer Confidence
- Continuous trading
- Convertible bond
- Cooperative stock exchanges
- Corporate bond
- Correlation coefficient
- Counter transaction
- Countercyclical investment
- Countercyclical stocks
- Country risk
- Coupon
- Course notes
- Covered warrant
- Creation
- Credit risk
- Creditworthiness
- Cum
- Currency bond
- Cyclical shares
- Cyclical stocks
Convertible bond
Like other bonds, convertible bonds bear interest, and their face value is repaid in full upon maturity. However, the owner of a convertible bond also has option rights. During a specified period, the convertible bond can be exchanged for shares in the issuing company at a pre-determined price, which is usually higher than the price of the stock at the time the bond was issued. Because option rights are attached to it, a convertible bond bears interest at a lower rate than other comparable bonds.
The issue of a convertible bond must be approved at the Annual General Meeting by a three-fourths majority vote. The company usually undertakes a capital increase to ensure that there will be enough shares for conversion. Existing shareholders are given subscription rights to the new shares.