CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

Which of the following securities is NOT a fixed-income obligation?

A. Convertible bonds
B. Collateral trust bonds
C. Warrants
D. Preferred stock
Correct Answer: C

A warrant does not constitute ownership of a stock, only the option to buy the stock. It is a type of option and does not yield a fixed income.

User Contributed Comments 4

User Comment
johntan1979 Warrants are classified under "equities".
gill15 So is preferred stock but I guess becasue for valuation purposes PS is treated as Fixed income securities when dividends are clearly paid....how do we know its clearly paid?
Logaritmus Investopedia tells us that Preferred stock is equity, but usually has a fixed dividend payouts so it is fixed income security for its owner and we may treat it as a fixed-income obligation.
joeclark PS is normally a debt instrument (technically). F*ck investopedia.
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