Convertible securities are financial instruments, such as bonds or preferred stocks, that can be converted into a predetermined number of common shares of the issuing company. This feature allows investors to benefit from potential stock price appreciation while still receiving fixed income from the security. Investors often choose convertible securities for their flexibility and potential for higher returns. If the company's stock performs well, they can convert their securities into shares, participating in the company's growth. Conversely, if the stock underperforms, they can still receive interest or dividends, providing a level of downside protection.