| This paper first introduces the current development situation of convertible bonds in domestic, then introduces three common pricing method of options.It startes fi-om a binary tree model, through the consideration redemptive terms and back to sell clause,uses five period backward method, national debt interest rate insteads of the same risk-free rate, historical volatility insteads of volatility.compares the value of each node, confirms the method how to beg convertible bonds price, then selectes six representative convertible bonds in six industry in the market, compares theory price and actual price by error method, indicate their volatility, interest rate, drift rate,etc how to affect the pricing of convertible bonds in China, elaborates the reason for the theoretical price deviating from the practice price, puts forward a constructive suggestion to our country convertible bonds development. |
