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Conversion Premium |
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Conversion premium The extent by which the conversion price of a convertible security exceeds the prevailing common stock price at the time the convertible security is issued. In general usage, the conversion premium is the amount by which the convertible security trades above its conversted value. For example, if a $1,000 par bond is trading at $1,100, it is convertible into 50 shares, and the shares are trading at $21, the converted value is 50 X 20.50 = $1,025, and the conversion premium is $75.
Conversion Premium The amount by which a convertible security is trading above the common stock into which it may be converted. Most convertible securities trade at a conversion premium, though it usually lessens as the common stock increases in price. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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25 percent coupon and a 22 percent conversion premium. g) Adjustment represents the conversion premium on the $25 million of subordinated convertible debentures that was paid in shares of K2 common stock. This represents a 26 percent conversion premium based on the last reported sale price of $46. |
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