Posted in Finance, Accounting and Economics Terms, Total Reads: 520
Definition: Put Warrant
It is a type of security that gives the person holding the underlying asset a right to sell it at a specified price. The person has the right to sell the security on or before a specified date. It is an option given by the company according to which a specific number of shares can be sold back to the company at a particular price.
Put warrants is an investment option that can give profit from a falling market.
An investor who has bearish approach of the market can use put warrants and can benefit from the decreasing price of the underlying asset.
A company may issue stocks with a warranty that it will buy back stocks at a particular price and before an expiry date.
Warrant is a contractual financial instrument which gives special rights to the holder of the asset. It is based on the discretion of the holder and has a expiry date before which the right has to be exercised.