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Warrant
Term category: Derivatives, Advanced
In 10 words or less: An instrument that allows investors the opportunity to buy stock at a later time.

Definition: A derivative that gives the buyer a right to buy share of stock at a certain price at a certain time.

More Details: The two major differences between warrants and options are that warrants typically have later strike dates and are issued by the company.

Also, warrants are usually used to "sweeten" fixed income offerings in order to make them more attractive.

Warrants are freely transferable and are traded on many exchanges.

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