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Special Report on

Reverse Convertible Bonds and Securities

reverse convertible bonds and securities special research report Photo by i237.photobucket.com
When a sophisticated provider of financial services stands toe to toe with a naïve consumer, the all-too-predictable conclusion resembles the results of a heavyweight champion and a ninety-eight-pound weakling. The individual investor loses in a first-round knockout. (David Swensen, Unconventional Success, Free Press (August 2005), p. 341) Whenever interest rates fall to historically low levels Wall Street’s product machines crank out complex securities that entice investors with extravagant yields, but come accompanied by great risks. Among the more alluring of products is something called a reverse convertible. ...
rate, the instrument carries additional value through the option to convert the bond to stock, and thereby participate in further growth in the company's equity value. The investor receives the potential upside of conversion into equity while protecting downside with cash flow from the coupon payments. From the issuer's perspective, the key benefit of raising money by selling convertible bonds is a reduced cash interest payment. However, in exchange for the benefit of reduced interest payments, the value of shareholder's equity is reduced due to the stock dilution expected when bondholders convert their bonds into new
REVIEWS AND OPINIONS
Regulators Report that Investment Scams are on the Rise ...
Scams will always be with us but they are especially plentiful when traditional investments like stocks and bonds are not doing well, according to John Waggoner of USAToday in his August 5, 2010 article, “Investment Scams Thriving.” "It's pretty bad out there," Texas Securities Commissioner Denise Voigt Crawford was quoted as saying. The primary victims are those trying to make up losses in their 401(k) plans and stock portfolios, she added. The North American Securities Administrators Association (NASAA) recently released its annual Top 10 Investor Traps, which can be viewed at ... market research, surveys and trends
Recent Trends in Indian and Global Capital Market
The Indian capital market is more than a century old. Its history goes back to 1875, when 22 brokers formed the Bombay Stock Exchange (BSE). Over the period, the Indian securities market has evolved continuously to become one o the most dynamic, modern, and efficient securities markets in Asia. Today, Indian market confirms to best international practices and standards both in terms of structure and in terms of operating efficiency .Indian securities markets are mainly governed by a) The Company’s Act1956, b) the Securities Contracts (Regulation) Act 1956 (SCRA Act), and c) the Securities and Exchange Board of India (SEBI) Act, ... market research, surveys and trends

SURVEY RESULTS FOR
REVERSE CONVERTIBLE BONDS AND SECURITIES

Credit Suisse Lost $120 Million in Korean Derivatives Gone Awry ...
Oct. 16 (Bloomberg) -- Credit Suisse Group, Switzerland's second-biggest bank, lost about $120 million on South Korean derivatives in the third quarter, an undisclosed stumble by equity traders struggling to catch the leaders in the securities industry. The debacle, which wasn't reported to shareholders, resulted from the Zurich-based bank's failure to protect itself against swings in the value of Korean stock options, said two people with knowledge of the matter. The loss equals about 13 percent of Credit Suisse's second-quarter revenue from equities trading. Brady Dougan, promoted by Chief ... industry trends, business articles and survey research
SIFMA Research Report - Volume 3 No. 8
volume of $58.0 billion and 80.2 percent less than second quarter 2007 .... New York, which includes repurchase and reverse repurchase agreements ..... convertible debt, asset-backed and non-agency mortgage-backed securities, ... Combining corporate debt (straight bonds and securitizations) and equity ... industry trends, business articles and survey research
RELATED NEWS
Evergreen Energy Reports Second Quarter 2010 Financial Results
DENVER, Aug 09, 2010 (BUSINESS WIRE) -- Evergreen Energy Inc. (NYSE Arca:EEE), a green energy technology solutions company, reported its second quarter 2010 financial results. "The second quarter of 2010 has been a period of significant progress for Evergreen," stated Thomas H. Stoner, Jr., CEO and director of Evergreen. "We began private beta testing of GreenCert(TM) EMIT, advanced the product development of GreenCert Energy 2.0 focusing our product line on the energy and utility market, and made progress with K-Fuel(R) in China via our equity joint venture. In ... market trends, news research and surveys resources
TULLETT PREBON PLC - Half Year Report
TULLETT PREBON PLC INTERIM RESULTS - for the six months ended 30 June 2010 Tullett Prebon plc (the "Company") today announced its preliminary results for the six months ended 30 June 2010. Financial Highlights - Revenue GBP475.8m (2009: GBP517.9m) - Operating profit GBP84.7m (2009: GBP100.6m) - Operating margin 17.8% (2009: 19.4%) - Adjusted Profit before tax (1) GBP78.6m (2009: GBP92.8m) - Adjusted EPS (2) 25.5p (2009: 28.5p) Notes 1. Adjusted PBT is stated before non cash gains and losses in net finance income/ (expense). A reconciliation of the adjusted PBT to the reported PBT of GBP79.3m ... market trends, news research and surveys resources

INFORMATION RESOURCES

Reverse Convertible Bonds Analyzed
JEL classification: G10 and G19. Keywords: reverse convertible bonds, reverse exchangeable securities, structured products. † Corresponding author. ... technology research, surveys study and trend statistics
Working Paper 10-2: Automatic Recapitalization Alternatives
The issuer of a reverse convertible bond may convert it into stock or its cash .... examining catastrophe ('cat') bonds. Catastrophe bonds are securities ... technology research, surveys study and trend statistics
AN EMPIRICAL ANALYSIS OF PRICING DUTCH REVERSE CONVERTIBLE BONDS ...
underlying security reaches the knock-in level this “normal” bond becomes a reverse convertible. The risk of the investments is reduced; a knock-in ...
REAL TIME
REVERSE CONVERTIBLE BONDS AND SECURITIES
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QUESTIONS AND ANSWERS
What are callable bonds? what are some unique features about them ...
A1) A callable bond can be redeemed by the issuer before the stated maturity date. This is typically done when current interest rates are below the coupon rate on the bond, this allows the issuer to call its higher rate bonds and refinance them with lower rate bonds. A2) There are three primary types of call features, including: *Optional Redemption. Allows the issuer, at its option, to redeem the bonds. Many municipal bonds, for example, have optional call features that issuers may exercise after a period of years, often ten years. *Sinking Fund Redemption. Requires the issuer to regularly set aside money for the redemption of ...
Question: Financial product
What is the product below, in layman's terms? Is it a bond? Does its performance depend on the performance of the company's shares? It offers 15% p.a., so there must be a risk somewhere. ========= The Worst of Barrier Reverse Convertible is a product that offers the investor a coupon which is higher than the coupon of a comparable standard bond. In return for this,the investor takes the risk that he will receive the worst performing of the underlying shares (or an equivalent cash amount) at the Final Settlement Date. This will be the case if at least one of the Underlying Shares closes at or below the Strike Price ...