Irredeemable Convertible Unsecured Loan Stock - ICULS

DEFINITION of 'Irredeemable Convertible Unsecured Loan Stock - ICULS'

A type of security that can be used to purchase underlying common shares. It is similar to a warrant except that it is subject to the conversion ratio. In essence, an ICULS provides the benefits of a bond until it is converted to an equity.

BREAKING DOWN 'Irredeemable Convertible Unsecured Loan Stock - ICULS'

ICULS pays a coupon to the holder every six months at a predetermined rate. The ICULS can be converted to equities at any time up to the expiration date, but if it is not converted by then, it will expire and be worthless. Because an ICULS is based on a conversion to common shares, its price is determined by the conversion ratio. For example, if the conversion ratio is 5:1 (five ICULSs for each common share) and the price of the common share is $20, the price of the ICULS will be $4.

RELATED TERMS
  1. Warrant

    A derivative that confers the right, but not the obligation, ...
  2. Hybrid Security

    A security that combines two or more different financial instruments. ...
  3. Call Warrant

    A financial instrument that gives the holder the right to buy ...
  4. Convertible Bond

    A bond that can be converted into a predetermined amount of the ...
  5. Contingent Convertibles - CoCos

    A security similar to a traditional convertible bond in that ...
  6. Busted Convertible Security

    A convertible security that is trading well below its conversion ...
Related Articles
  1. Bonds & Fixed Income

    Convertible Bonds: An Introduction

    Find out about the nuts and bolts, pros and cons of investing in bonds.
  2. Options & Futures

    Warrants: A High-Return Investment Tool

    Discover the advantages of this largely unexploited investment vehicle.
  3. Options & Futures

    What Does Quadruple Witching Mean?

    In a financial context, quadruple witching refers to the day on which contracts for stock index futures, index options, and single stock futures expire.
  4. Professionals

    Is A Stockbroker Career For You?

    Becoming a stockbroker requires a broad skill set and the willingness to put in long hours. But the rewards can be enormous.
  5. Investing

    How Rising Interest Rates Affect Junk Bonds

    We examine the impact of rising interest rates on higher-yielding bonds.
  6. Mutual Funds & ETFs

    The 4 Best Fidelity Funds for Income Seekers in 2016

    Discover the four best fixed-income mutual funds administered and managed by Fidelity Investments suitable for income-seeking investors.
  7. Investing

    What Investors Need to Know About Returns in 2016

    Last year wasn’t a great one for investors seeking solid returns, so here are three things we believe all investors need to know about returns in 2016.
  8. Mutual Funds & ETFs

    The 4 Best Vanguard Funds for Income Seekers in 2016

    Discover four mutual funds administered and managed by the Vanguard Group that would be suitable for income-seeking investors for 2016.
  9. Investing Basics

    How to Pick A Stock

    The first step in picking stock is to determine your goals.
  10. Investing Basics

    5 Tips On When To Buy Your Stock

    Buying stocks that make you money can be a satisfying experience for a variety of reasons, not the least of which is the impact it has on your bottom line.
RELATED FAQS
  1. Do convertible bonds have voting rights?

    Convertible bonds usually have no voting rights until they are converted. Even after conversion, they may not be granted ... Read Full Answer >>
  2. What is a convertible bond?

    A convertible bond is a bond issued by a corporation that, unlike a regular bond, gives the bondholder the option to trade ... Read Full Answer >>
  3. What are 'death spiral' convertible bonds?

    Conventional convertible bonds give the bondholder the right to exchange the bond for a certain amount of the issuer's common ... Read Full Answer >>
  4. What are the maximum Social Security disability benefits?

    The average Social Security disability benefit amount for a recipient of Social Security Disability Insurance (SSDI) in 2 ... Read Full Answer >>
  5. How do I calculate the future value of an annuity?

    When planning for retirement, it is important to have a good idea of how much income you can rely on each year. There are ... Read Full Answer >>
  6. Have hedge funds eroded market opportunities?

    Hedge funds have not eroded market opportunities for longer-term investors. Many investors incorrectly assume they cannot ... Read Full Answer >>
Hot Definitions
  1. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
  2. Discouraged Worker

    A person who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment ...
  3. Ponzimonium

    After Bernard Madoff's $65 billion Ponzi scheme was revealed, many new (smaller-scale) Ponzi schemers became exposed. Ponzimonium ...
  4. Quarterly Earnings Report

    A quarterly filing made by public companies to report their performance. Included in earnings reports are items such as net ...
  5. Dark Pool Liquidity

    The trading volume created by institutional orders that are unavailable to the public. The bulk of dark pool liquidity is ...
Trading Center