What is a Kicker?
In the finance world, a kicker is a feature that makes a security more attractive.
How Does a Kicker Work?
Often, kickers are equity kickers, which are the right but not the obligation to buy shares of the issuer of a bond. These equity kickers come with the bond, making them more saleable to investors.
Sometimes, kickers aren't useful. For instance, they might offer the bondholder the right to buy shares at $8 a share, which only comes in handy if the shares are trading above $8. In those cases, the bond issuer might increase the coupon rate instead.
Why Does a Kicker Matter?
Kickers get deals done. They make securities more saleable, and they help companies raise the capital they need to raise to grow. For investors, kickers can raise the gains or profits they might earn on a security.
Personalized Financial Plans for an Uncertain Market
In today’s uncertain market, investors are looking for answers to help them grow and protect their savings. So we partnered with Vanguard Advisers -- one of the most trusted names in finance -- to offer you a financial plan built to withstand a variety of market and economic conditions. A Vanguard advisor will craft your customized plan and then manage your savings, giving you more confidence to help you meet your goals. Click here to get started.
Read This Next
When it comes to figuring out credit scores, there are very few things that are obvious. Really, I spend a lot of time following this stuff and sometimes...
Read More →
If you want to improve the chances that you make it through the next recession with your finances intact, here are 10 steps to take now: 1. Save More...
Read More →
Back in 2003, the head of my company boasted that his new investment in Apple (Nasdaq:...
Read More →
If you’re like many American homeowners, the only liability insurance you carry is what your...
Read More →
"Price is what you pay. Value is what you get." -- Warren Buffett Putting his finger on this difference between price and value in ...
Read More →
