Explain why warrants are rarely exercised, Financial Management

Assignment Help:

Explain why warrants are rarely exercised unless the time to maturity is small?

Warrants are seldom exercised till the time to expiration is small because the market price of the warrant is greater as compared to the exercise value.  The holder of the warrant would hence sell it in the secondary market in place of exercising it if he or she wishes to cash in.


Related Discussions:- Explain why warrants are rarely exercised

Explain present value of a series of cash flows, Q. Explain Present Value o...

Q. Explain Present Value of a Series of Cash Flows? Present Value of a Series of Cash Flows: - In a business circumstances it is very natural that returns received by a firm ar

State expectations theory of term structure of interest rate, State the exp...

State the expectations theory of the term structure of interest rates. Expectations theory: The expectations theory of the term structure of interest rates specifies that

ASSIGNMENT, Assume that we have the following data: C=100+0.50Y Ip=100-20r...

Assume that we have the following data: C=100+0.50Y Ip=100-20r Mt=0.10Y Ms=100-10r M=80 a. Build the IS-LM function. b. If we assume an increase in Investments by 100 units, p

Advantages and disadvantages of investing in gilts, Advantages and Disadvan...

Advantages and Disadvantages of Investing in Gilts Advantages As the security is issued by the GOI, it has a minimal default risk. Investors have the opportunity to inves

Acquisition planning and strategy, A c quisition Planning and Strategy ...

A c quisition Planning and Strategy In the previous section, we discussed about the constraints to successful merger integration. In this section, we will learn how to plan a

The national budget and governmental policies, Question 1: Explain clea...

Question 1: Explain clearly how the study of Public Policy making enables us to understand how Government tackles the major problems of society. Question 2: Analyse th

What are the material items are carried out, What are the Material items ar...

What are the Material items are carried out Material items would have an impact on: Audit tests carried out. For illustration compliance based testing (relying on contro

Explain the strategic alliance, Explain the Strategic alliance Two  or ...

Explain the Strategic alliance Two  or  more  organisations  agree  to  work  and  collaborate  informally  together  however remaining  independent  from  one  another. Simila

Explain takeovers obligation, Takeover, Inc. is a Delaware corporation whos...

Takeover, Inc. is a Delaware corporation whose only stated purpose is to acquire companies.  It has virtually no assets and no employees other than the original founders who contri

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd