Research On Pricing Of Convertible Bonds In China Based On Black-Scholes Model

As a compound financial instrument,convertible bonds are increasingly favored by listed companies because of their own characteristics.In recent years,the entire convertib le bond market has also developed rapidly.However,compared with its own rapid development,the research based on convertible bond pricing is particularly insufficient in terms of quantity and theoretical depth.In this context,this paper summarizes the existing research on convertible bonds.The case of the airline letter-to-debt is selected for data analysis,and the pricing method of the Black-Scholes model is selected for the Chinese market.Using the literature review method and case analysis method,the following basic conclusions are drawn:By analyzing the case of airline letter-to-debt,it can be considered that the pricing of the airline's convertible bonds is significantly underestimated.Compared with the theoretical value,the actual price of the airline's convertible bonds is 7.46%lower.The main reasons for the differences are the applicability of the Black-Scholes model,the error in parameter calculations,and other influencing factors that cannot be quantified.Through case analysis,it is hoped that the pricing mechanism of China's convertible bonds can be further explored and improved,and China's convertible bond market can be further improved and developed.