SIE practice questionmediumRights vs Warrants
Which statement about rights and warrants is TRUE?
- ARights are issued above market price.
- BWarrants are usually longer-term than rights.✓ Correct answer
- CWarrants cannot be traded on exchanges.
- DRights always guarantee a profit.
Explanation
Why B — Warrants are usually longer-term than rights.
Warrants last years; rights are short-term. Rights are below market, both can be traded, and neither guarantees profit.
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