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Definition: Warrants

A warrant is type of instrument which entitles the purchaser to buy a fixed number of ordinary shares at a particular price during a specified time period.

It is similar to an American call option.


1. Investors have access to shares without investing in them now.

2. Helps promoters in increasing their holdings


Warrants are issued to hedge currencies and protection against fluctuation of currency with the help of speculative analysis.

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