A security that gives the holder the right, but not the obligation, to purchase shares of stock in a ﬁrm for a ﬁxed price over a speciﬁed period of time is called a(n):

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A warrant is a security that gives the holder the right, but not the obligation, to purchase shares of stock in a firm for a fixed price over a specified period of time. It is similar to an option, but warrants are issued by the company itself, while options are traded on exchanges. Convertible bonds give the holder the option to convert the bond into shares of stock, but they are not the same as warrants. The other choices are unrelated to warrants.

A Security That Gives the Holder the Right, but Not