Convertible Arbitrage

Dictionary Says

Definition of 'Convertible Arbitrage'

An investing strategy that involves the long position on a convertible security and a short position in its converting common stock.
Investopedia Says

Investopedia explains 'Convertible Arbitrage'

This strategy attempts to exploit profits when there is a pricing error made in the conversion factor of the convertible security.

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Related Definitions

  1. Arbitrage

    The simultaneous ...
  2. Common Stock

    A security that ...
  3. Conversion Price

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  4. Convertibles

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  5. Short (or Short Position)

    1. The sale of a ...
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  7. Liquidation

    1. When a ...
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