The Study On Chinese Exchangeable Bonds Based On Valuation Method

In recent years,the exchangeable bonds grows vigorously in the bond market of our country.On the one hand,the quantity of financing and distribution both rise,on the other hand,market investment enthusiasm is heated.This is because Chinese bond market has become increasingly mature,the absence of stock option market and regulatory requirements of the reduction of shareholders of listed companies and so on.At the beginning of the development of exchangeable bonds in our country,it is fully absorbing complex option clause characteristics in foreign mature capital market.Such as 15 Tianji EB,the bond has a number of special terms such as price,forced redemptions,back to the sales terms in addition to basic terms.This reasons lead to the issuer and investors added complexity on the valuation and pricing.However,the study of the theory in the exchangeable bonds is not comprehensive,and it is mainly focused on the theoretical characteristics of exchangeable bonds issue,underweight,or even to be classified as convertible bonds is studied.Even though now for the valuations of exchangeable bonds,investment strategy has strong practical significance,the direction of the research is not thorough.In this paper,the meaning of it is in the hope of perfecting the above research,thus to exchangeable bonds issue strategy,investment strategy and regulation of strong practical guiding significance to the recommendations.In this paper,it based on the perspective of valuations for represented by 15 Tianji EB with complex options in terms of exchangeable bonds investment and financing were analyzed,and the theory combined with quantitative research in motivation,financing costs,exchangeable bonds issue investment strategies and so on.Based on my improved least squares monte carlo simulation method for pricing valuation,this paper according to the result of the valuation of the above problem analysis,thinks that there are overvalued exchangeable bonds investment in our country,the reason is that investors insufficient understanding of complex options,on the underlying stock returns and volatility overvalued;exchangeable bonds motivation mainly cooperate with series of capital operation in underweight;exchangeable bonds financing costs relatively low underweight,relatively pure bond is higher;to invest exchangeable bonds,investors need to combine hedging strategy.At the same time,on the basis of summarizing obvious problems existing in the current development of exchangeable bonds,for stakeholders to provide corresponding advice.