CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

Which of the following statements regarding warrants is FALSE?

A. Most warrants can be exercised anytime within their specified lives, which typically run between 5 and 10 years.
B. A warrant is a call option to buy shares of stock.
C. A warrant does not represent ownership in a company.
D. A warrant is issued by an investor expecting the price of the underlying stock to rise.
Correct Answer: D

Warrants are issued by corporations, not investors. They are a type of call option that will allow the holder to profit if the underlying stock price rises.

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