Morning Commentary: Opendoor convertible notes active on otherwise quiet morning

By Abigail W. Adams

Portland, Me., Aug. 25 – Opendoor Technologies Inc.’s 0.25% convertible notes due 2026 were active on a quiet morning in the convertibles secondary space as equities hovered near all-time highs.

Equity benchmarks were largely flat early Wednesday with the S&P 500 index and Nasdaq continuing to squeak out fresh records.

The Dow Jones industrial average was up 74 points, or 0.21%, the S&P 500 was up 0.14% and the Nasdaq Composite was up 0.03% shortly before 11 a.m. ET.

There was $64 million in reported volume a little over one hour into the session.

Opendoor’s 0.25% convertible notes were among the most actively traded in the secondary space as the notes continued their upward momentum.

The 0.25% notes continued to trade on a 109-handle with stock off slightly.

The 0.25% notes were changing hands at 109.25 versus an equity price of $16.97.

There was $8 million in reported volume.

Opendoor’s stock was changing hands at $17.18, a decrease of 0.49%, shortly before 11 a.m. ET.

Opendoor’s convertible notes were initially volatile in the aftermarket and traded as low as a 96-handle.

While the notes spent their first days in the aftermarket trading below or at par, they improved dramatically on an outright basis over the past few sessions.

The notes jumped to 106 on Monday and have steadily climbed alongside stock since.

Opendoor priced the 0.25% convertible notes at par on Aug. 17 with the greenshoe recently exercised in full, lifting the size of the deal to $977.5 million.

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