Convertible debt represents an important source of financing for U.S. companies. We examine whether convertible bond issuance activity is influenced by changes in investor demand for convertible debt. We find that investor demand proxies are able to explain approximately one-third of the...

Investor demand for convertible debt may change over time, due to changes in investor tastes and/or in funds available for convertible investment. We examine whether security-issuing firms cater to temporal fluctuations in investor demand for convertible debt. We find that investor demand...