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What are Warrants?
Warrants are a form of financial derivatives. Derivatives' values are dependent on and derived from underlying assets. For e.g., for a warrant which tracks ABC company as the underlying asset, its value is dependent on ABC company¡¯s share price (Note: there are other factors that affect the price of a warrant).
The definition of a warrant ¨C a warrant gives you the right but not the obligation to buy the shares of an underlying asset at the exercise price and at a future fixed date. (note: some warrants are settled in cash and no conversion to shares are involved)
Warrants, unlike shares, have an expiry date, and become worthless thereafter. They are either settled in cash or be converted to shares of the underlying.
Warrants are a form of financial derivatives. Derivatives' values are dependent on and derived from underlying assets. For e.g., for a warrant which tracks ABC company as the underlying asset, its value is dependent on ABC company¡¯s share price (Note: there are other factors that affect the price of a warrant).
The definition of a warrant ¨C a warrant gives you the right but not the obligation to buy the shares of an underlying asset at the exercise price and at a future fixed date. (note: some warrants are settled in cash and no conversion to shares are involved)
Warrants, unlike shares, have an expiry date, and become worthless thereafter. They are either settled in cash or be converted to shares of the underlying.