Core Viewpoint - The convertible bond market has shown significant activity, with a notable increase in trading volume and interest from investors due to its unique characteristics that combine both bond and stock attributes [1][2]. Market Activity - In May, the trading volume of convertible bonds exceeded 1.37 trillion yuan, and in the first eight trading days of June, the total trading volume reached 702.19 billion yuan, averaging 87.77 billion yuan per day [1][2]. - As of June 13, the total outstanding convertible bonds amounted to 797.77 billion yuan, a decrease of 73.02 billion yuan since the beginning of the year [2]. - The average price of convertible bonds in the market was 121.99 yuan, with an average conversion premium rate of 70.75%, and 99 convertible bonds had a conversion premium rate exceeding 100% [2]. Performance Analysis - The CSI Convertible Bond Index has increased by 1.65% this year, while the Shanghai Composite Index has risen by 1.81% [2]. - The top ten active convertible bonds have seen an average daily trading volume of 2.81 billion yuan, with their underlying stocks averaging a gain of over 30% [3]. Future Outlook - Analysts predict that the convertible bond market will continue to expand in the second half of the year, driven by decreasing opportunity costs and favorable supply-demand dynamics [3][4]. - The focus for investors should be on high-quality companies and sectors with strong growth potential, including state-owned enterprises and industries related to emerging technologies [3][4]. Selection Criteria - Investors are advised to consider various factors when selecting convertible bonds, including stock market style, sector performance, and the underlying stock's financial metrics such as gross margin and return on assets [4]. - The importance of understanding redemption clauses, particularly conditional redemption, is emphasized, as 17 convertible bonds have undergone strong redemption this year [5].