Explain why warrants are rarely exercised, Financial Management

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

Warrants are hardly ever exercised until the time to expiration is small because the market price of the warrant is greater than the exercise value. The holder of the warrant would thus sell it in the secondary market instead of exercising it if he or she wanted to cash in.

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ABF, HOW TO CALCULATE ASSESSED BANK FINANCE

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