Study On The Financing Efficiency Of Convertible Bonds In Listed Companies

Convertible Bonds (CB) are hybrids between debt and common equity. The use of CB has soared during the last several decades in the international capital market. Recently CB financing is now emerging in our capital market. Up till now, there are more than forty firms have issued CB. The domestic academia has showed much interest, but mostly the focus is affected on the theory of CB pricing aiming at arbitrage. A theory about the financing efficiency of CB can hardly be seen. This research begins with analyzing the enterprises' financing efficiency, dissects the financing efficiency of CB with empirical study method. This text's purpose is to help Listed Companies rationally know the special financing tool, and point out how to use it properly. This paper is divided into five parts.This article stands the view of enterprises' financing efficiency. It analyzes the status in the financing efficiency of CB from the cost of capital and the efficiency of money point view. The text mainly adopts empirical study method. First of all, On the theoretical analysis basis, we bring up the hypothesis that the financing efficiency of CB is not high. The next, a theoretical CB model on the cost of capital is created in consideration of average weighted and the time value of money analysis. Besides, the paper sets up Wilcoxon signed-rank test to assess the efficiency of CB's money. Last, we empirically analyzes the financing efficiency of CB. As a result, we discover the cost of CB capital is higher than the other financing ways. (such as long-loan, common bond and ordinary share). In the meantime, the outcome shows that though the efficiency of CB money is still higher the allotment of shares and increasing issue, the efficiency of CB money is low.This article's conclusion is that the cost of CB capital is higher, and the efficiency of CB money is low. Therefore, the financing efficiency of CB is low. So this paper brings up a few suggestions. For example, we can forecast properly changeable shares price and strengthen the supervisee of CB money. The aim is to promote List Companies effetely use the CB.This thesis's innovative points include: (1) This research begins with analyzing the financing efficiency. To the newest extent, it gives an experimental study of the financing efficiency of CB. (2) It analyzes the cost of CB capital from quantification view.