Warrants: Advice and legal defense

Warrants are a high-risk financial product that is characterized for a very high probability of losing all the investment. Set against the incorrect marketing of these products, our Law Firm has become specialised in pursuing legal actions with the purpose of recuperating the investment made.

What are warrants?

Warrants are securities negotiable on the stock market that grant the holder the right, but not the obligation, of buying/selling, through a financial mediator, a specific quantity of underlying assets under pre-established conditions, by the payment of a premium, that is to say, at a prefixed price on a future and specific date, or during the lifetime of the warrant (American model).

When the warrant is for purchasing it is known as a call warrant, and when it is for sale, it is called a put warrant. The warrant, just like options, grants the holder the possibility of performing or not the related transaction (buy or sell, as it may correspond) and to the other party, the obligation of complying therewith.

The versatility of the product is determined by the existence of warrants upon shares, stock market indexes, commodities and interest rates, among others.

Characteristics of the warrants

Warrants are characterised by being shares issued collectively by an entity and under the administration of book-entry shares and listed for trading on an exchange. They fall within the category of options, having a maturity date between one and two years. Furthermore, warrants enjoy greater liquidity, given that the issuing entities are responsible for that.
We recommend reading an article of the paper called Expansión, which describes the most recent investments and the trend of the investors in Spain regarding warrants.