Convertible Bonds Empirical Analysis

Convertible bonds has been a great part of China stock market for the past several years. More and more people pay their attention to it. The affiche that Zhaoshang bank was going to issue 10 billion convertible bonds shocked the stock market. A lot of people gave their opinions in the great debate. The author used a lot of data to analysis the character of convertible bonds in China market.At first, the author introduced us the basic theory on convertible bonds. Secondly, the author improved the binomial tree model to simulate the movement of stock price. Thirdly, the author used the model to calculate the value of convertible bonds. At last, the author analysis the output and give us his own opinion. The author believed the convertible has been used only as a means to get money. It's some like the biggest stockholders treat the investors and the current stockholders check the bill.Through the analysis, the author give us a new means to calculate the value of the convertible bonds and give us the inner reason. It will do a lot of help to the investors and the issuers.