Puttable bonds have continued to cause problems for US issuers over the past 12 months. Deals were done on terms that at the time seemed attractive, if not almost free for some. Now many of those puttable convertibles are trading so far out of the money that investors, whether straight convertible players or the hedge funds that now seem to own up to 80% of US convertible outstandings, are choosing to exercise their puts rather than wait around for stock prices to improve.
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