A stack warrant is a type of financial instrument that provides the holder with the right, but not the obligation, to buy or sell an underlying asset at a predetermined price within a specified time frame. It is similar to a stock option but is issued directly by the company and gives the holder the right to purchase the company's stock at a specific price and date. When an investor exercises a stack warrant, they purchase the stock directly from the company, and the proceeds are a source of capital for the company. The stack warrant does not represent immediate ownership of the stock but only the right to purchase the company shares at a particular price in the future. Stack warrants are less common in the United States but are more prevalent in other countries such as China. They can be a useful tool for companies to raise capital and manage their shareholders' interests. However, they can also lead to dilution of existing shareholders' equity when exercised, as new shares are issued, increasing the total number of shares outstanding12.
11/6/2024 07:56am
