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You are considering investing $820 in Higgs B. Technology Inc. You can buy common stock...

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Finance

You are considering investing $820 in Higgs B. Technology Inc. You can buy common stock at $22.16 per share; this stock pays no dividends. You can also buy a convertible bond ($1,000 par value) that is currently trading at $820 and has a conversion ratio of 33. It pays $48 per year in interest. If you expect the price of the stock to rise to $31.09 per share in one year, which instrument should you purchase?

The holding period return on the purchase of the common stock would be (Round to two)

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