What is a stock warrant
Stock Warrants. Stock warrants are options issued by a company that trade on an exchange and give investors the right (but not obligation) to purchase company stock at a specific price in a specified time period. When an investor exercises a warrant, they purchase the stock, and these proceeds are a source of capital for the company. Stock Warrant or Share Warrant is the right to purchase the shares of a stock at a certain price and within a stipulated time period. It expires after a certain point of time if the investor does not exercise them. However, the holder of a stock warrant has the right to deny the purchase i.e. he is not locked in to purchase the stock. In finance, a warrant is a security that entitles the holder to buy the underlying stock of the issuing company at a fixed price called exercise price until the expiry date. Warrants and options are similar in that the two contractual financial instruments allow the holder special rights to buy securities.