CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

What is a bond warrant?

Bond warrant

It is a derivative instrument giving the holder the right, but not the obligation, to buy or sell a specific bond at a specific price either on a particular day or within a specified time period.

Where have you heard about bond warrants?

Your financial adviser may have suggested using them and specialist investment publications may feature them as part of an overall investment strategy. Investment guides are likely to have a section on bond warrants.

What you need to know about bond warrants.

They are derivatives, in that they 'derive' their value from the actual security. Bond warrants are similar to options in that the holder has the right to buy or sell the bond concerned but is not obliged to exercise that right. One reason to buy a bond warrant would be to hedge an investor's position by ensuring that, for example, they are able to buy the bond question should its price rise above that specified in the warrant. Another would be to build up a position in the bond in question without having to lay out a large amount of money upfront.

Latest video

Latest Articles

View all articles

Still looking for a broker you can trust?

Join the 650,000+ traders worldwide that chose to trade with Capital.com

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading