Abstract
A warrant is a security that allows the holder to subscribe to another newly issued security during a given period, in a proportion and at a price fixed in advance. A hybrid security may seem unnatural since it combines a low-risk asset (bond) with a high-risk asset (share). A convertible bond is like a traditional bond except that it also gives the holder the right to exchange it for one or more shares of the issuing company during a conversion period set in advance. The securities called preference shares or preferred shares enjoy economic advantages over ordinary shares, typically in return for a total or partial absence of voting rights. Mandatory convertibles are hybrid securities, which automatically convert into a predetermined number of shares dependent on the stock price at the time of conversion. Industrial groups use hybrid bonds either to diversify their investor base or to secure their rating and strengthen their capital structure.