CONVERSION PREMIUM
conversion premium: translation
A convertible's conversion premium is the amount by which a convertible's market price exceeds its value in stock. The premium may be expressed as the dollar difference or as a percentage. American Banker Glossary
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The extent by which the conversion price of a convertible security exceeds the prevailing common stock price at the time the convertible security is issued.In general usage, the conversion premium is the amount by which the convertible security trades above its converted value. For example, if a $1,000 par bond is trading at $1,100, it is convertible into 50 shares, and the shares are trading at $21, the converted value is 50 X 20.50 = $1,025, and the conversion premium is $75. Bloomberg Financial Dictionary
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The amount by which the price of a convertible bond exceeds the market price of the underlying stock. Exchange Handbook Glossary
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conversion premium conversion premium ➔ premium1
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conversion premium UK US noun [C]
► FINANCE,
STOCK MARKET »
The market conversion premium per share is usually expressed as a percentage of the current market price.