$Carvana Co.(CVNA)$ The challenge for bondholders to hedge by shorting the equity is that there are $5.7B in unsecured bonds (face value), or about $3B in their value based on recent trade prices. The outstanding stock is 107M shares. At the current price ($7.41/shr) that's just ~$800M. Even if you look to shorting the calls and buying the puts. It's a challenge for the bondholders to find enough equity (or options) to short to balance their bond holdings. I'm sure some bondholders have already put on the hedge, but this is probably a smallish percent of them.
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