What debt holders value about debt is downside protection. What they give up is upside.
What equity holders value about equity is upside participation. What they give up is downside protection.
Therefore, when debt holders voluntarily choose to convert from debt to equity, it’s because they value the upside potential of owning the equity more than the downside protection of owning the debt.
It’s a vote of confidence in the company.
🚨 BREAKING: S&P 500 $SPY 50 weekly moving average for third time in three years.
Once it breaks, historically doesn't reclaim for 12 weeks with an average -8% drawdown.
On a real note
I genuinely was done for the day here and had no attachment to the outcome
This was a coin flip
EVERY trade is a coin flip
And I think the biggest issue with a lot of you is you don’t think it’s a coin flip
The only thing that matters is risk management