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Warrant

Warrants are a type of derivative that grant the right, but not the obligation, to buy or sell a security—most often an equity—at a specific price before expiration. T he cost at which the underlying securities may be purchased or sold is referred to as exercise price or strike price. European warrants may only be exercised on the expiration date, whereas American warrants may be exercised at any time on or before that date. Call warrants and put warrants are terms used to describe warrants that grant the right to buy or sell securities, respectively.


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