What are warrants and blue chip shares ?

warrants

A security instrument issued to purchase common shares at a specified number and price at a specified time is called a warrant. In other words, a warrant is the right given to investors to buy common shares of the company in the future. Generally, warrants are also given along with bonds to make bond issuance attractive to investors. Investors are free to decide whether or not to buy ordinary shares using warrants in the future.

When the warrant is exercised, it is converted into ordinary shares, but the bonds remain the same. When issuing warrants, things like the price to be paid for purchasing ordinary shares in the future, the proportion of ordinary shares that can be obtained using the warrants and the time period for which the warrants have to be used are disclosed.

 Blue Chip Shares

Blue chip shares are the shares of organizations that have been earning profits for a long time through the efficient management of organized organizations and have been providing dividends to investors. These types of shares usually have a high value, while the dividend yield is moderate.

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