What characterizes a warrant

A warrant is a security that gives the holder the right to buy or sell an underlying asset, at a specified price, also called strike price. For many investors, warrants will seem similar to options but warrants typically have longer maturities than options, and are issued over a wider range of assets. Warrants are issued by financial institutions which will determine the terms for the specific warrant.

What does NASDAQ OMX Nordic offer

At NASDAQ OMX Nordic there are many warrants with an exciting variation of underlying assets to choose from. Warrants are divided into three types to make it easier to find and compare different warrants.

“Plain vanilla” is the heading of simple buy or sell warrants with shares, indices or currencies as underlying.

“Knock outs” are warrants that terminate and cease to exist, if the relevant price of the underlying asset touches a predetermined barrier. On the expiry date the value of the knock out warrant is the difference in price of the underlying and the strike price in the warrant.

“Exotics” are warrants with a more complex structure.

How does the trading in warrants work

You can trade warrants via your bank, broker or Internet broker. Banks often offer trading via their Internet port. You can trade warrants on the Exchange when they are issued or in the secondary market. Perhaps you don’t want to keep your warrants until they expire, but want to sell them before the expiration date. The market maker will ensure the possibility to do so by continuously quoting prices in the warrant on the Exchange.