Contingent conversion trigger
Used in the context of convertible instruments. The price of the stock must exceed the trigger price before the bond holder can convert to common stock at a pre-established conversion price. The trigger price exceeds the conversion price. In addition, after a certain number of years, the convertible instrument usually specifies that both the conversion price and the contingent conversion trigger will increase every year by, for example, a rate equal to LIBOR.
Nearby TermsContingent Contingent claim Contingent conversion trigger Contingent convertible capital instruments (Cocos) Contingent debt
Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University