Systematic risk changes around convertible debt offerings: A note on recent evidence

Benjamin Kleidt and Dirk Schiereck

Global Finance Journal, 2009, vol. 20, issue 1, 98-105

Abstract: We document a significant increase in systematic equity risk after a firm has issued convertible debt. In contrast, no such increase can be detected for equity issuers when infrequent trading and price adjustment delays are controlled for. The evidence is consistent with the notion that convertible debt issuers may be rationed out of the equity market due to uncertainty about their systematic risk.

Keywords: Systematic; risk; Convertible; debt; Seasoned; equity; offering (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:glofin:v:20:y:2009:i:1:p:98-105

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