Enter the par value of the convertible bond and the share price into the calculator to determine the conversion ratio.

## Conversion Ratio Formula

The following formula is used to calculate the conversion ratio on a bond.

CR = PV / SP
• Where CR is the conversion ratio
• PV is the par value of the convertible security/bond
• SP is the conversion price of the equity or share price

To calculate a conversion ratio, divide the par value of the bond by the conversion price of the equity or the share price.

## Conversion Ratio Definition

A conversion ratio is defined as the ratio of the par value of the convertible security to the price of the equity or share.

## Conversion Ratio Example

How to calculate a conversion ratio?

1. First, determine the par value.

Calculate or determine the par value of the security.

2. Next, determine the conversion price.

Calculate the conversion price of the equity.

3. Finally, calculate the conversion ratio.

Calculate the conversion ratio using the equation above.

## FAQ

What is a par value?

A par value is the face value of a bond.