Since the beginning of this year, domestic equity assets have achieved good returns. They are relatively dazzling in the global asset sequence. The Shanghai and Shenzhen 300 Index rose by nearly 15%, and the ChiNext Index rose by 48%. Convertible bonds, as an investment product with both equity and debt properties, coupled with the increase in supply since 2019, and the expansion of the optional range, have been highly valued by investors and have become an indispensable configuration for the "fixed income +" strategy select.

The convertible bond market has various sources of profit for investors, and the investment strategies of convertible bonds are also different. A common strategy is to invest in convertible bonds of high-performance companies, and use the increase in the value of the conversion brought by the improvement of the company's performance to realize the benefits. Take the delisted convertible bond of a leader in the express delivery industry. Since the issuance of the bond at the end of 2019, the company’s core business has been in continuous improvement, and its market share has increased. During the epidemic, it has achieved a much higher value than the same industry. Business growth. At the beginning of the year, the company's convertible bond price was around 120 yuan, and it rose to more than 180 yuan at the end of July, and finally achieved full conversion. The unsatisfactory part of this strategy is that the best-in-class companies are often the "red men" in the eyes of investors in the entire market, and their research coverage is relatively sufficient. Convertible bonds often continue to have a high premium rate, and there is no opportunity for "leakage". many. In fact, at the absolute price of 120 at the beginning of the year, the conversion premium of convertible bonds continues to be at the level of 30%. If there is no loose monetary environment brought about by the impact of the epidemic and a "re-understanding" of the company's core competitiveness, convertible bond investors may have to wait longer. And because the premium rate is too high, it is not a wise choice to invest in convertible bonds when it is possible to invest in underlying stocks. The company's underlying stocks have risen 88% this year, far exceeding convertible bonds.

Another strategy is to buy convertible bonds issued by companies with general qualifications (with a certain industry status, or a leader in a small industry), expecting that when the market favors a certain investment theme, the conversion price will be greatly increased. For example, in 2019, the auto industry was in a low economic cycle, and the price of convertible bonds issued by auto parts companies was once sluggish. With Tesla’s domestic mass production and the government’s continued strong policy support for new energy vehicles, the stock prices of some auto parts companies in the industry chain quickly repaired, and even soared, related convertible bonds followed. Have risen. The unsatisfactory part of this strategy is that the relevant stocks are often not the focus of institutional investors' research coverage, or they have only received periodic attention when the industry boom or the company boom comes. Once the market arrives, the stock price rises extremely rapidly. Except for a few investors who are extremely sensitive to changes in the business climate, other investors tend to be afraid of not knowing the underlying stocks and convertible bonds, and cannot grasp such opportunities well; Another psychological obstacle comes from the downturn in the industry. Companies with average qualifications often struggle to survive, their performance declines, their credit status is also poor, and there is a possibility that their credit ratings may be downgraded.

At present, compared with the former strategy, the latter strategy and similar strategies can better utilize the advantages of convertible bonds (the quality of the company is average, but there is debt support, and the attention of the underlying stocks is not High, prone to conversion premium rate). If you want to implement this strategy, you need to have a certain industry research foundation, have a basic understanding of the target of each convertible bond, and be able to do a moderate amount according to the size of the company, the volume of convertible bonds, the trading volume of equity and convertible bonds Decentralization.