Conversion Bond Formula

Conversion ratio# of shares that can be exchanged for one convertible bond | Par value of bond/ conversion price | Conversion pricePrice per share that determine the number of share you will received | Par value of bond/conversion ratio | Conversion value – an indication of what a convertible issue would trade for if it were priced to sell on the basis of its stock value. | Conversion ratio x market price of stock | Conversion premium ( in $)It is difference between the market price of the convertible bond and the higher of its security value and its conversion value * Use it if market price of convertible bond is given | Market price of convertible bond – conversion value | Conversion premium (in $) - Use it if market price of convertible bond is not given | Par value – conversion value | Conversion premium (in $)- Use it if market price of convertible bond is not given | Conversion price – market price of stock | Conversion premium (%) | Conversion premium (in RM)/conversion value | Conversion premium (in %) | Conversion price – market price of common stock/market price of common stock | Value of straight bond ( security value)It Is the value of the convertible without conversion feature. Thus, calculated as straight bond. | CP(PVIFA %,n) + Par value (PVIF,% n) | Payback period | Conversion premium/(annual interest payment from the convertible bond – annual dividend income from the underlying common stock) | Conversion parityThe price at which the common stock would have to sell in oder to make convertibke security worth its present market price. Aka conversion equivalent. | Market price of convertible bond/conversion ratio