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Finance Dictionary and Glossary of Investment Terms
Related: Fixed income equivalent. Mainly applies to convertible securities. Convertible bond selling essentially as a straight bond. Assuming the issuer is "money good," or will continue to meet credit obligations, such issues can be highly attractive since the price makes virtually no allowance for the bond's call on the common stock, although such issues usually carry high premiums.
A convertible security for which the market price of the common stock is so low that the convertible feature is nearly worthless, and the security trades almost as if it were a fixed income investment. also called fixed income equivalent.