Which of the following would harm the position of a warrant holder?
A) A stock split of 3 for 1.
B) A large stock dividend of 20%.
C) A large cash dividend.
D) Listing of the warrants on the NYSE.

Question

Quizplus · Accepted Answer

A large cash dividend would harm the position of a warrant holder because it reduces the company's assets and potentially its stock price, negatively affecting the value of the warrants. Stock splits, stock dividends, and listing on the NYSE generally do not harm and can even potentially benefit warrant holders by increasing liquidity or the underlying stock's value.

Which of the Following Would Harm the Position of a Warrant