When you’re ready to get serious about understanding the hybrid nature of convertible bonds—they have both equity and bond characteristics—it’s time to learn about the Convertible Price Track.
The Convertible Price Track illustrates the theoretical relationships between a convertible bond’s price and the par value of the bond as the underlying stock price rises or falls.
Vats of ink have been spilled in Calamos’ more than 40 years of using the price track to explain how a convertible’s value is determined. We even have one communication that features multiple pictures that step through the track.
But on the chance that an animation is worth 1,000 of our words, here's our animated Convertible Price Track.
Watch, learn—and when you’re ready for more, reach out to your Calamos Investment Consultant for additional insights about convertibles or any of our six convertible-using open-end funds or our six convertible-using closed-end funds. He or she can be reached at 888-571-2567 or email@example.com.
Opinions and estimates offered constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. We believe the information provided here is reliable, but do not warrant its accuracy or completeness. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The views and strategies described may not be suitable for all investors. Opinions are subject to change due to changes in the market, economic conditions or changes in the legal and/or regulatory environment and may not necessarily come to pass. This information is provided for informational purposes only and should not be considered tax, legal, or investment advice. References to specific securities, asset classes and financial markets are for illustrative purposes only and are not intended to be, and should not be interpreted as, recommendations.
Convertible securities risk consists of the potential for a decline in value during periods of rising interest rates and the risk of the borrower to miss payments, synthetic convertible instruments risk consisting of fluctuations inconsistent with a convertible security and the risk of components expiring worthless, foreign securities risk, equity securities risk, interest rate risk, credit risk, high yield risk, portfolio selection risk and liquidity risk.