A convertible security is a security that, at the option of the holder, may be exchanged for another asset, generally a fixed number of shares of common stock. Convertible issues frequently are fixed-income securities such as debentures and preferred stock.

A bond, debenture or preferred stock that may be exchanged by the owner for common stock or another security, usually of the same company, in accordance with the terms of the issue.

Corporate securities (usually preferred stock or bonds) that are exchangeable into a fixed number of shares of common stock at a stipulated price. Convertibles may also be exchanged into other forms of the security, but it is unusual. Convertible securities are usually bought by investors who want higher income than what can be received from common stock combined with a greater potential for appreciation than what can be received from regular bonds. A corporation will issue convertibles to enhance the marketability of their securities. See: Common Stock Equivalent; Convertible Bond; Convertible Debenture; Convertible Preferred Stock; Kicker

Debt or equity that may under some circumstances be exchanged for or converted into another security, usually common stock

Convertible securities are corporate securities (usually preferred stock or bonds) that are exchangeable for a set number of another form of securities at a prestated price or ratio.