conversion value

Conversion value

The value of a convertible security if it is converted immediately. Also called parity value or converted value.

Market Conversion Price

The price one effectively pays for common stock when one exercises the conversion option of a convertible security. One calculates the market conversion price by dividing the price one paid for the convertible security by the conversion ratio, which is the number of shares of common stock one receives by exercising the conversion option. In order for the exercise of the option to be worthwhile, the market conversion price must be lower than the market price of common stock. It is also called the conversion parity price and the conversion value.

conversion value

The market value of the underlying asset(s) into which a convertible security may be exchanged. Generally, conversion value is calculated by multiplying the number of shares that can be obtained by the market price per share. Thus, a bond that can be converted into 30 shares of stock with a market price of $20 each has a conversion value of $600.
References in periodicals archive ?
dollar reduced the conversion value of non- dollar assets, central bank data showed Wednesday.
In certain circumstances, the notes may be converted into cash up to their principal amount, and into shares of The Priceline Group common stock and/or cash at The Priceline Group's election for the conversion value above the principal amount based on a conversion rate of 0.
Date for the exchange rate communicated by BNR, which will be considered in the conversion value, corresponding participation guarantee established in another currency is 4 days before the deadline for submission of tenders.
The fair value of the convertible bond is calculated using the market value of the bonds when they are out of the money and the conversion value when they are in the money.
Joachim Kundt, CEO, Siemens LLC, comments: "Today Siemens is the only company that offers solutions along the entire energy conversion value chain.
Joachim Kundt, CEO, Siemens, said: "Today Siemens is the only company that offers solutions along the entire energy conversion value chain.
Even as foreign exchange authorities offered dollar liquidity to the market, the foreign reserves rose last month due to higher investment profits and a rise in the dollar conversion value of non-dollar assets, including the euro, said HaKeun-cheol, an official at the BOK.
As European Directive 2008/100/EC now establishes, the energy conversion value of erythritol is zero calories, recognizing the unique status of Zerose erythritol as the only polyol sweetener that contributes zero calories to final food formulations.
NYBC will not only bring vital jobs to the Long Island City neighborhood, but the deal validates Long Island City as a prime commercial destination at a time when most properties in the area are looked upon solely for their residential conversion value.
Additionally, as the price of the common stock fluctuates, so does the conversion value of these securities.
Convertibles can be rather difficult for individual investors to trade profitably, since volume in the convertible market is thin and convertibles' value depend on complicated calculations of yield and conversion value.
Upon conversion, the issuer must pay cash to debt holders at the conversion value (the number of shares the holder is entitled to upon conversion x the stock price on the conversion date).