This article presents a rational theory of warrant pricing. The theory assumes that investors seek to maximize expected returns based on their forecasts of a company's future stock price. The model shows how warrant prices are determined based on the relationship between the stock price and time remaining until the warrant's expiration date.
This article presents a rational theory of warrant pricing. The theory assumes that investors seek to maximize expected returns based on their forecasts of a company's future stock price. The model shows how warrant prices are determined based on the relationship between the stock price and time remaining until the warrant's expiration date.
Original Description:
Rational Theory of Warrant Pricing by prof Samuelson
This article presents a rational theory of warrant pricing. The theory assumes that investors seek to maximize expected returns based on their forecasts of a company's future stock price. The model shows how warrant prices are determined based on the relationship between the stock price and time remaining until the warrant's expiration date.
This article presents a rational theory of warrant pricing. The theory assumes that investors seek to maximize expected returns based on their forecasts of a company's future stock price. The model shows how warrant prices are determined based on the relationship between the stock price and time remaining until the warrant's expiration date.
