What is a Synthetic Convertible Bond?

What is a Synthetic Convertible Bond?

James speaks on synthetic convertibles and their most common form. He briefly touches on Glencore’s 2018 issuance of $500 million in synthetic convertibles.
Overview

An instrument where the issuer has sold a convertible bond in the equity-linked market and bought a matching call option from one or more banks. The result is, the issuer is left with a simple profile of straight debt.

Key learning objectives:

  • Define a Synthetic Convertible

  • Describe how an issuer can hedge its exposure using options

  • Explain why issuers hedge, and give an example of this.

Join now to watch

This content is also available as part of a premium, accredited video course. Sign up for a 14-day trial to watch for free.

Summary
logo-animationlogo-animationlogo-animation
Expert
James Eves

James Eves

Career banker with over 25 years working in investment banking. James has worked in many aspects of banking including equity capital markets, origination, IPOs and hybrid capital.

Related videos

Join now to watch

This content is also available as part of a premium, accredited video course. Sign up for a 14-day trial to watch for free.