warrants and Options

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Tenbinza
Senior Forum Member
Posts: 20
Joined: Tue May 15, 2012 9:14 pm

warrants and Options

Post by Tenbinza »

Hi,
What are the main differences bet Warrants and Options? And Pro and Cons.
They always mention Option Premium and earn when buy or sell.
alvin
Investing Mentor
Posts: 325
Joined: Sat Sep 26, 2009 1:52 pm

Re: warrants and Options

Post by alvin »

Options and warrants are very similar. Options are often issued to employees as bonuses while warrants are issued to investors to raise money.
Both can be converted to real shares.

In Singapore, there are only warrants and no options market.

Warrants can be issued by a company or a third party.

Warrants issued by companies are usually convertible and may not be tradeable.

Warrants issued by third parties such as banks are cash settled and are tradeable. Majority of the warrants you see in SGX are third party warrants or known as structured warrants.

In US, you can sell options. In Singapore, you can only buy warrants.
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