Log in

View Full Version : Covertible Shares


poofy85
Jul 22, 2010, 09:53 PM
I am confused by the wording of this: "The company has 400,000 preferred shares. They are convertible into common shares 6 for 1 at the option of the investor".

I am confused by the 6 for 1... Does this mean for every 1 preferred share they get 6 common shares? Or for every 6 preferred shares they get 1 common?

ArcSine
Jul 23, 2010, 04:31 AM
The former. To keep it straight, think of it in terms of the shareholder: "6 for 1" means "I get 6 for every 1 I trade in."