Undetachable Stock Warrant

DEFINITION of 'Undetachable Stock Warrant'

A right attached to a bond that can be redeemed for stock, but cannot be sold separately from the bond. Undetachable stock warrants are considered low-risk because they can be substituted for another security with a higher return.


An undetachable stock warrant is also referred to as a convertible bond.

BREAKING DOWN 'Undetachable Stock Warrant'

A warrant is a type of certificate issued with a preferred stock. A preferred stock gives its holder claim to earnings and assets prior to common stockholders. The warrant enables the holder of the certificate to buy a certain amount of stock at a specific date at a specific price. Most often, this price is higher than the market price when the warrant or convertible bond is issued.

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RELATED FAQS
  1. Are warrants more desirable than options?

    Understand what stock warrants are, the differences between warrants and options, and learn whether warrants or options are ... Read Answer >>
  2. I own some stock warrants. How do I exercise them?

    Typically, stock warrants are derivative instruments added to new issues of stocks or bonds to make these issues more attractive. ... Read Answer >>
  3. Is there a secondary market for warrants?

    Find out how to trade warrants on the primary market, the secondary market and the over-the-counter market, including how ... Read Answer >>
  4. What is the difference between convertible and reverse convertible bonds?

    The difference between a regular convertible bond and a reverse convertible bond is the options attached to the bond. While ... Read Answer >>
  5. How do I use a premium put convertible?

    Holders of convertible bonds face all the pitfalls that traditional bondholders face - liquidity risk, interest rate risk ... Read Answer >>
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    A convertible bond is a bond issued by a corporation that, unlike a regular bond, gives the bondholder the option to trade ... Read Answer >>
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