Company-issued options tend to arise because of:

A) market demand
B) a company's financing needs
C) market reports
D) all of these options

Question

Company-issued options tend to arise because of:

A) market demand
B) a company's financing needs
C) market reports
D) all of these options

Quizplus · Accepted Answer

Warrants traded on the Australian Stock Exchange are issued by a third party.In an issue of third-party warrants,the issuer is usually not related to the underlying company.Company-issued options tend to arise because of a company's financing needs.In comparison,for third-party warrants,although there may be some requirement for funds by the issuer,the securities will tend to be issued because of market demand.Financial institutions can issue these warrants to extract fee income from the market.In essence,the issuer,which is usually a financial institution,sees an issue of warrants as a way of generating income.

Company-Issued Options Tend to Arise Because Of