Convertible bonds generally carry a higher yield than nonconvertible corporate bonds of comparable quality and maturity.

Question

Quizplus · Accepted Answer

Convertible bonds typically offer lower yields than comparable nonconvertible bonds because they also grant the holder the option to convert the bond into a predetermined number of shares of the issuing company, adding value through the potential for capital appreciation.

Convertible Bonds Generally Carry a Higher Yield Than Nonconvertible Corporate