Parity Price formulas Flashcards
1
Q
parity price of bonds
A
stocks mkt price * conversion ratio
2
Q
parity price of stocks
A
bonds mkt price / conversion ratio
3
Q
parity price of preferred stock
A
common stock mkt price * conversion ratio
4
Q
parity price of common stock
A
preffered stock mkt price / conversion ratio
5
Q
what do parity price formulas ALL have in common?
A
they all divide or multiple by CONVERSION RATIO