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SIE: Equity Securities
SIE practice questionmediumWarrants

Which is TRUE about warrants compared to rights?

  1. AWarrants are issued to common shareholders only.
  2. BRights are issued above current market price.
  3. CWarrants typically have longer maturities than rights.✓ Correct answer
  4. DRights are not transferable.
Explanation

Why CWarrants typically have longer maturities than rights.

Warrants last years, while rights are short-term. Rights are usually below market, both can be transferable, and warrant recipients vary.

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