--%>

Why warrants are hardly exercised unless small time maturity

Describe why warrants are hardly ever exercised unless the time to maturity is small?
Warrants are hardly ever exercised until the time to expiration is small since the market price of the warrant is higher than the exercise value. The holder of the warrant would thus sell it in the secondary market rather than exercising it if he or she wanted to cash in.

   Related Questions in Finance Basics

  • Q : What is Expenditure Authority

    Expenditure Authority: The authorization to make expenditure (generally by a budget act appropriation, provisional language or some other legislation).

  • Q : What is Working Capital and Revolving

    Working Capital and Revolving Fund: For legal base accounting purposes, fund categorization for funds employed to account for the transactions of self-supporting enterprises which render goods or services for a direct charge to the user that is genera

  • Q : Financial crisis of India during 1997 I

    I have to explain Financial crisis of India during 1997. Can someone help me in this question ?

  • Q : Define Allotment Allotment : The

    Allotment: The permitted division of an amount (generally of an appropriation) to be expended for a specific purpose throughout a particular time period. An allotment is usually authorized on line item expenditure basis by program or

  • Q : State Section 8.50 Section 8.50 : The

    Section 8.50: The Control Section of Budget Act gives the authority to raise federal funds expenses authority.

  • Q : Why do analysts compute financial ratios

    Why do analysts compute financial ratios? Ratios are comparative measures.  Since the ratio illustrates relative value, they let financial analysts to compare information which could not be compared in its raw form.  For instance, rati

  • Q : Define Financial Controls Financial

    Financial Controls: Any measure of how fine a company or department controls its costs, at times stated as how far beneath or over budget it is. Financial controls are a critical portion of any financial system. They make sure that the resources are b

  • Q : Define Obligations Obligations : The

    Obligations: The amounts that a governmental unit might legally be needed to pay out of its resources. Budgetary authority should be obtainable before obligations can be formed. For budgetary aims, obligations comprise payables for goods or services r

  • Q : Production possibilities curve based

    Given is a production possibilities table for consumer goods (automobiles) and capital goods (forklifts): Illustrates these data graphica

  • Q : Describe the status of cyclically

    Assume the full-employment, non-inflationary level of real output is GDP3 (not GDP2). If the economy is operating at GDP2 instead of GDP3, describe the status of its cyclically adjusted budget? The status of its present fiscal polic