Hybrid bond

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Can you comment on hybrid bond. Are they good investment for retiree like me
Thanks

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Asked on March 18, 2022 3:43 pm
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Dear Dan
Thank you for your timely excellent answer

It definitely answers my question and help me to make my investment decision better

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Posted by Patrick Huang
Answered on March 20, 2022 3:03 pm
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By hybrid bond I imagine you mean a convertible bond, as in one that is able to convert to common shares at one point?

Convertible bonds are certainly an interesting investment in the fact they can fluctuate in price relative to the shares of common stock of the issuing company. Convertible bonds typically have lower coupon rates because of the ability for people to convert them to common shares. So, it's pretty hard to give you a definitive answer on what is best for you. There is no question they are riskier when looking at a normal bond. They pay lower coupon rates and will fluctuate in price much more than a traditional bond.

So I guess it all just depends on what you're trying to achieve with the bond. Would you want to convert the bond to common shares at one point? If not, I'm not sure one of these would make sense really.

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Posted by Dan Kent
Answered on March 20, 2022 12:22 pm