In the third part of our “easy-language” series, we will discuss a very popular structured product payoff structure from the yield enhancement category: the reverse convertible.
Although there are various versions available today, we will focus on the “plain vanilla” variant. A second structured product explained: reverse convertible (RC) from the “yield enhancement” category. From the table in the first part of our article, here is the profile we have for “Yield Enhancement”: Source: Evolids Finance In terms of exposure, the (classic) reverse convertible is made of a combination of a (long) straight bond and a plain vanill