So dual-low convertible bonds should be understood this way, evil cultivators are indeed evil.

Recently, I was chatting with Brother Xie Xiu, and his strange ideas and bizarre thoughts almost blew my mind. Not to mention, he explained dual low convertible bonds like this: only those with a price below 120 yuan and a premium rate below 20% are truly dual low, with the 120 yuan threshold being a hard indicator. The traditional 130-30 is just a joke. For example, suppose you have a stock priced at 10 yuan, and you do T+0 trading, struggling to bring it down to 8 yuan, only to hit a limit-down and lose six months of effort. If you want to break even without losing money, you need to bring your cost to zero—how difficult is that? But if you hold a 120-yuan convertible bond and manage to bring its cost down to 100, then if it falls further, the lower the maturity price, the higher the profit. If it rises, you can sell directly for profit. Moreover, if you buy a 104-yuan convertible bond and reduce your cost to 80, you’ve achieved a historic profit. Looking at past major dips, how low can a convertible bond go? So, the bottom line for dual low is that the stock’s limit-up or limit-down is involved—that’s the real dual low.

Do you think his approach makes sense? Anyway, I feel it’s quite reasonable. Such targets, especially those rated AA or above, are very rare. He also discussed many details and risks of the game, even providing quantitative standards. The discussion was too extensive to go into detail here.

Additionally, his understanding of hybrid funds is also astonishing. The term “hybrid fund” is something he created himself. The betting strategies involved are too complex to explain here.