SHIFT · US
US convertible bond issuance reaches record levels as tech companies and AI investors harness equity upside
US convertible bond markets are experiencing historic issuance volume, driven by tech and AI-related firms seeking cheap funding while preserving equity upside in a bull market. This is a core funding engine for AI startups and established tech's capital allocation.
WHY IT MATTERS
Convertible bond holders assume hidden leverage: if AI-driven valuations collapse, conversion risk materializes into equity dilution and credit losses. Banks, hedge funds, and pension funds holding convertible exposure face asymmetric tail risk if tech valuations normalize.
Source: Financial Times · 2026-06-02