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Stock Warrants: What They Are and How They Work

By Kristi Waterworth – Updated Apr 17, 2025 at 12:36AM

Key Points

  • Stock warrants provide a right to buy a stock at a set price, similar to options but are company-issued.
  • Warrants can offer high profits if the stock price rises, though they also carry a risk of dropping to $0.
  • Unlike options, warrants can have up to 15 years' term, giving more time for the stock to surpass strike price.
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