Intermediate
Subordinated corporate hybrids and payment deferral
Corporate hybrids can give an issuer flexibility over distributions and repayment. Investors need to assess that flexibility as a risk they are financing.
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Hybrid Securities Trading Guide
Understand securities that combine features of debt, equity and derivatives. Follow eight stages covering preferred shares, convertibles, corporate hybrids, bank capital and structured notes.
Start with What makes a security a hybrid, then follow the next lesson links. Explore 32 lessons with worked examples, exercises and further reading.
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Corporate Hybrids and Capital Structure · All lessons
Corporate Hybrids and Capital Structure
Read subordination, payment deferral, extension and issuer funding incentives.
Intermediate
Perpetual securities and the difference between a call and maturity
A perpetual has no ordinary contractual maturity. Its first call date is an issuer option, so a portfolio should remain workable if the security stays outstanding.
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Intermediate
Cash coupons and payment in kind interest
Payment in kind interest increases a claim instead of delivering current cash. A growing balance can coexist with weaker credit and a lower market value.
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Intermediate
Why companies issue hybrids and how investors assess the trade
An issuer and an investor evaluate the same hybrid from different perspectives. Funding flexibility for the company can create payment, conversion or extension risk for the...
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