Bonds, Interest Rates & Exchange Rates

How do bonds with warrants (BWs) and convertible bonds (CBs) differ as bonds?

Den svenska versionen av den här sidan förbereds. Tills vidare visas innehållet på engelska.

With a convertible bond, exercising the conversion right turns the bond into shares, and the bond is extinguished.

With a bond with warrants, exercising the right to buy new shares (the warrant) extinguishes only the warrant portion; the bond itself remains outstanding and in effect until maturity. As a result, BW investors can expect both bond interest and gains from a rise in the share price, but they also continue to bear the issuer's credit risk until maturity.

Last updated

This answer is general financial information as of 2026-10-14, not investment advice. Rules and tax rates change, so please also check the latest guidance from the source institution.