A warrant gives the holder the right to buy shares of the issuing company at a specified price within a specified timeframe.
Although both are equity derivatives the major difference between warrants and call options is that warrants are issued directly by the company. They also tend to be longer dated than options, it's not uncommon for warrants to be valid for years, whereas Options tend to only be good for months.
Warrants occasionally trade on exchanges.
Related Fool Articles
Recent Mentions on Fool.com
- Will Apple and Google Join the Tech Free Fall?
- 3D Systems Corporation: 1 Likely Contributor to Its Stock Price Fall That You Might Not Be Aware Of
- Better Buy: Illumina, Inc. Vs. Intuitive Surgical, Inc.
- For International Business Machines Corp. Earnings, Here's What Really Matters
- Ask a Fool: GOOG vs. GOOGL Shares
- Yelp Inc: A Long-Term Growth Story