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Conversion |
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ConversionIn the context of securities, refers to the exchange of a convertible security such as a bond into stock. In the context of mutual funds, refers to the free exchange of mutual fund shares from one fund to another in a single family.ConversionThe process by which a mutual organisation such as a building society changes itself into a company. Quite often accompanied by healthy payouts to members of the building society, which has attracted the interest of carpetbaggers. Also known as 'demutualisation'.The process of converting convertible loan stock in a company into ordinary shares. The right to convert is inherent in the convertible loan stock but usually you will only be allowed to convert on a particular date. The company will issue a notice to shareholders telling them when they can convert and telling them the applicable conversion ratio e.g. i.e. how many ordinary shares they can get for each unit of convertible loan stock.Similar MatchesConversion valueConversion valueThe value of a convertible security if it is converted immediately. Also called parity value. Conversion termsConversion termsThe terms which apply when convertible loan stock, for example, a bond or a debenture, are converted into ordinary shares or preference shares. These would include the price and date of conversion which are fixed at the issue date.The terms which apply when a warrant is converted into shares. These would include the exercise price, the date or period of conversion and the number of shares (normally one per warrant) which the warrant holder would be entitled to purchase. Conversion parity priceConversion parity priceRelated: Market conversion price Conversion arbitrageConversion arbitrageThe simultaneous purchase of a stock, the purchase of a put, and the sale of a call, creating a riskless transaction. Conversion ratioConversion ratioApplies mainly to convertible securities. Relationship that determines how many shares of common stock will be received in exchange for each convertible bond or preferred stock when a conversion takes place. It is determined at the time of issue and is expressed either as a ratio or as a conversion price from which the ratio can be figured by dividing the par value of the convertible by the conversion price. Further SuggestionsEquitable ConversionConversion parity currency conversion Conversion ratio Conversion price Conversion Period Conversion parity or value Conversion factors Conversion feature Conversion premium Stated conversion price Limitation on conversion Reverse conversion Involuntary Conversion |
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