Portfolio manager explains why investors should consider convertible bonds over straight bonds

Analyzing Convertible Bonds. Jackson Metals, Inc., issued a 1,000 convertible corporate bond. Each bond is convertible to 40 shares of the firm's common stock. (Obj. 2 ) a. What price must the common stock reach before investors would consider converting their bond to common stock? b. If you owned a bond in Jackson Metals, would you convert your bond to common stock if the stock's price did reach the conversion price? Explain your answer. | Numerade

Understanding Convertible Bonds: Definition, Examples, and Key Benefits