Phil has researched TLM Technologies and believes the firm is poised to vastly increase in value.He wants to invest in this company.Phil has decided to purchase TLM Technologies bonds so that he can have a steady stream of interest income.However,he still wishes that he could share in the firm's success along with TLM's shareholders.Which one of the following bond features will help Phil fulfill his wish?

Question

Quizplus · Accepted Answer

A warrant is an option that allows an investor to purchase shares of the issuing company's stock at a fixed price before the expiration date. By purchasing a bond with a warrant feature, Phil can benefit from the interest income of the bond while also having the option to purchase shares of TLM Technologies at a fixed price, allowing him to share in the potential success of the company.

Phil Has Researched TLM Technologies and Believes the Firm Is