• Lower Yield: convertible bond offers lower yield than the straight bond of similar quality because they have the option to convert.
• Conversion Premium: The conversion premium on convertible bonds is an addition premium that investor pay for the option to convert their bond into common shares of the issuers. This premium lower the yield on the bond.
• Dilution: when the convertible bond is converted into the common share, it increases the number of outstanding shares, which you be dilute by the existing shares.

Conclusion
Convertible bonds offer investors the potential for income and equity with in a single investment. There are types of convertible bond available, and investors should consider the pros and cons of each before deciding to invest. While convertible bonds offer reduced the downside risk, they also come with lower yield and the risk of dilution if the bonds are converted in common shares. Overall convertible bond can be useful investment tool for those seeking income and equity participation.