Warrant (Finance) | Reference | Definition | Finance

What is a Financial Warrant?

Warrants are a derivative* which allow the holder to buy or sell a security at a certain price before the expiration of the warrant. Warrants give you the right, but not the obligation, to buy or sell a security.

A warrant that gives you the right to buy securities is called Call Warrant.

A warrant that gives you the right to sell securities is called a Put Warrant.

American warrants can be exercised at any time before expiration but European warrants can only be exercised on the expiration date.

* derivative is a product having a value from an underlying variable asset such as stocks, gold, currency, web assets, commodity, digital assets held on the internet.

Trefuly fungibles are considered securitised derivative since they have an underlying asset (domain name and webpage.)