CONVERTIBLE BONDS

Caution:

When stocks and bonds are stagnant,convertible bonds may be ananswer. In addition to an attractiveyield, convertible bonds have somethingextra going for them—theright to convert the bonds to commonstock. With this convertiblefeature, you win if the stock pricerises, since the price of your bondsalso goes up. Or you can convert thebonds into stock that's worth morethan you paid for the bonds. Butyou don't lose if the stock goesdown, since you still collect theinterest and the full value of yourinvestment at maturity, as long asthe company stays solvent. Convertible bonds are not fornovice investors. Talk to a professionalinvestment advisor beforeyou put any money into them.