The Alchemist - The covert attraction of convertibles

With deference to Bill Gross, the ‘must-avoids' are, surely, the easy bit. It's my ‘must-haves' that are in short supply.

Where can investors find a product that offers shelter from the volatility promised in 2010, but participation in any reasonable rallies? Picking through the rather limited number of options, the one that emerges, rather coyly, is convertible bonds. Forget for one moment the bling of contingents, exchangeables, mandatory or reverse covertibles, and remember the good old plain-vanilla product. It was developed first, like most financial ideas, in the US. In the 1980s, when even sensible people expected great things from Japan, they were national favourites, with that one market account...