Which of the following is not a normal characteristic of a convertible bond?
A) Conversion at the option of the issuer.
B) Conversion into a fixed number of shares of common stock.
C) A conversion price initially above the market price of the common stock.
D) An interest rate lower than that on straight debentures.
E) Subordination.

Question

Quizplus · Accepted Answer

Conversion at the option of the issuer is not a normal characteristic of a convertible bond. Convertible bonds typically have conversion at the option of the bondholder, not the issuer.

Which of the Following Is Not a Normal Characteristic of a Convertible