Question: What are other basic features of the convertible bonds?
Answer: Basic features of the convertible bonds are below - The conversion can be allowed for all or only some portion of the bond’s life. - The conversion ratio can decline/reduce over time. - Conversion ratio always adjusted proportionately for stock splits and stock dividends. - Convertible bonds are usually callable by the issuer. - There are some convertible issues that can have call protection. Which can be either of this o The issuer is not allowed to redeem the issue before a specified date o Issuer is not permitted to call the issue until the stock price has increased by a predetermined percentage price above the conversion price at issuance.
Question: What are the warrants?
Answer: A warrant is an option which corporation issues that permits the investor to buy from the corporation a certain number of shares of common/equity stock at a specified price.
Question: What are the features of the warrants?
Answer: Few of the basic characteristics of the warrants are below. - Its an option. - Warrant has long life e.g. 2 years to perpetual. - Exercise price is usually higher than the market price of common stock.
Question: What does it means of having non/detachable warrants?
Answer: Detachable warrants are usually traded on the Stock Exchange. Other warrants can be exercised only by the bondholder, and these are called nondetachable warrants.