The Convertible Bond Boom: $243 Billion in Institutional Hands and Growing

Every quarter, institutional managers disclose their equity holdings in 13F filings. But the same filings also capture something less discussed: convertible bonds. These are corporate bonds that can be converted into shares of the issuing company — a hybrid sitting between debt and equity. The SEC requires their disclosure precisely because of that embedded equity optionality. In Q4 2025, convertible bond holdings across all 13F filers totaled $243 billion, up 31% from the same quarter a year earlier. That makes it the largest convertible bond total in the three years of data tracked here.

What's interesting isn't just the growth — it's who's driving it, and what it says about how institutions are choosing to access certain companies.

More money, fewer hands

The total value of convertible bond positions has climbed sharply, but the number of managers holding them has moved in the opposite direction. In Q4 2022, 738 managers held at least one convertible position — about 10% of all 13F filers. By Q4 2025, that number dropped to 577, or just 6.6% of filers. The convertible market is concentrating. Specialist convertible arbitrage funds and large multi-strategy firms are taking bigger positions, while generalist equity managers appear to be stepping back.

Meanwhile, equity holdings across the same filings reached $67.3 trillion in Q4 2025 — more than double the $32.8 trillion three years prior. Converts have grown in absolute terms, but equities have grown faster. Convertible bonds now represent roughly 0.4% of total disclosed institutional holdings, down from 0.7% in 2022.

The most widely held converts aren't what you'd expect

The companies with the most institutional holders of their convertible bonds in Q4 2025 read less like a bond portfolio and more like a tech stock watchlist. Ford and ON Semiconductor lead by manager count, but names like Coinbase, Rivian, Strategy (formerly MicroStrategy), and Snowflake all appear in the top fifteen.

• Ford Motor Company (F) — 125 institutional holders
• ON Semiconductor (ON) — 117 holders
• Akamai Technologies (AKAM) — 112 holders
• Coinbase Global (COIN) — 102 holders
• Alibaba Group (BABA) — 101 holders
• Rivian Automotive (RIVN) — 100 holders
• Strategy Inc. (MSTR) — 97 holders
• Etsy (ETSY) — 97 holders
• Live Nation Entertainment (LYV) — 96 holders
• Uber Technologies (UBER) — 95 holders

For several of these, the convertible bondholder base is a meaningful fraction of the equity holder base. About one in five institutional holders of Haemonetics also holds its converts. For Etsy and Dropbox, it's closer to one in six. These aren't niche instruments for these companies — they're a parallel ownership layer.

Crypto's zero-coupon convert machine

The most dramatic growth in convertible bond holders came from crypto-adjacent companies that used zero-coupon converts as a funding mechanism to buy Bitcoin. MARA Holdings saw its bondholder count jump from 31 to 73 after completing a $1 billion offering of 0% notes due 2030 in November 2024. Strategy (MSTR) grew from 73 to 95 holders, adding to an already dense base built across multiple massive issuances — including $3 billion in 0% notes due 2029.

The structure is distinctive: these companies issue convertible bonds paying no cash interest, use the proceeds to buy Bitcoin, and effectively sell equity at a premium through the conversion option. For investors, it's a way to get Bitcoin exposure through a corporate credit wrapper with equity upside. For issuers, it's essentially free money as long as the stock price cooperates. Strategy alone has roughly $5.7 billion in convertible bonds held by institutional managers — more than most companies' entire market capitalization.

A wave of old paper matured and cleared out

While new issuance was flooding in, a cohort of pandemic-era convertible bonds reached maturity in late 2025. The exits were swift and total.

Shopify's $920 million of 0.125% notes matured in November 2025 — its bondholder count dropped from 54 to 1. PDD Holdings' $2 billion of zero-coupon notes, originally issued by Pinduoduo in 2020, matured in December and the holder count went to zero. Uber's older $1 billion convert from 2020 also matured in December, contributing to a holder decline from 128 to 94 (partially offset by newer exchangeable notes issued in 2025).

This maturity wave is worth noticing because it represents a generational turnover in the convertible market. The 2020–2021 issuance boom produced by near-zero interest rates is now rolling off, replaced by a new vintage of converts issued under very different conditions — higher rates, different issuers, different reasons for choosing the structure.

New arrivals: from SaaS to nuclear energy

Thirteen convertible bonds appeared in Q4 2025 filings for the first time — meaning no institutional manager held them in Q3. The mix of issuers tells its own story about where capital is being deployed through convertible structures.

• Datadog (DDOG) — 68 holders, the most widely held debut
• Guidewire Software (GWRE) — 56 holders
• Centrus Energy (LEU) — 23 holders, $1.1 billion in value
• Fluence Energy (FLNC) — 27 holders
• Synaptics (SYNA) — 36 holders

Datadog and Guidewire represent the now-familiar pattern of profitable SaaS companies tapping the convertible market for growth capital at a lower coupon than straight debt would require. Centrus Energy — one of only two companies licensed to enrich uranium in the United States — is a different story entirely, suggesting that the nuclear energy buildout for AI data centers is starting to show up in convertible structures, not just equity valuations.

The biggest positions by dollar value tell a different story

Holder count and dollar value don't always align. Alibaba leads by total value at $11.7 billion across 101 holders. Western Digital, Lumentum, and EchoStar each sit in the $7–8 billion range with far fewer holders. These are concentrated, high-conviction positions rather than broadly distributed ones.

For Alibaba specifically, the convertible bond story diverges from the equity story. Direct equity ownership of Chinese ADRs has been a contentious institutional decision for years — geopolitical risk, delisting concerns, and regulatory uncertainty have pushed many managers away. Yet 101 institutions hold $11.7 billion in Alibaba converts, sitting structurally senior in the capital stack while retaining upside through conversion. The bond position and the equity position may be telling different stories about institutional conviction.

What converts reveal that equities don't

Convertible bonds in 13F filings offer a view that pure equity data misses. When a manager holds a company's convertible note instead of — or alongside — its stock, it signals something about risk appetite. The bondholder gets downside protection through the debt floor, periodic coupon income (when there is one), and retains upside through the conversion option. It's a different bet than buying the stock outright.

The current landscape suggests a few things worth watching. The convertible market is becoming more specialized — fewer managers participating, but those who do are taking larger positions. New issuance is being shaped by specific structural needs: crypto companies funding Bitcoin treasuries, energy companies funding AI infrastructure, and SaaS companies refinancing at lower coupons. And as the pandemic-era vintage matures, the composition of what shows up in 13F filings is shifting toward this newer, more intentional cohort of issuers.

Notes

Data is drawn from 13F filings covering Q4 2022 through Q4 2025 (report dates December 31 of each year, with interim quarters where noted). 13F filings require disclosure of convertible bonds due to their embedded equity optionality — straight corporate bonds and government debt are generally not included. The "debt" classification in 13F filings is effectively synonymous with convertible bonds. Total US convertible bond issuance reached approximately $109 billion in 2025, a record. Individual security positions, including convertible bonds, are available through the security pages and quarterly ownership changes on FilingFrog.