What does a conversion transaction include?

A conversion transaction specifically refers to a situation that involves the exchange of one type of investment security for another, such as converting a bond into shares of stock. In this context, a straddle on stock positions, which is an investment strategy that involves holding a position in both a call and a put option on the same stock, can be seen as a type of conversion transaction.

This option aligns with the definition of conversion transactions because it illustrates how assets can be shifted between different forms of investment while still being centered around a single underlying asset (in this case, stock).

The other choices do not properly represent the nature of conversion transactions. For instance, limiting transactions to those before a certain date doesn't capture the essence of conversion activity. Similarly, simple investment purchases without contracts do not categorize as conversions; they are straightforward purchases without the nuances of security exchange involved in conversion transactions. Finally, transactions that do not involve property do not fit within the recognized boundaries of conversion transactions, as these transactions typically involve the alteration of ownership or rights concerning securities or investments.