What is a warrant, and does etoro support them?

A warrant is a financial instrument that gives the holder the right, but not the obligation, to buy a company’s stock at a specific price (known as the exercise price) before a certain expiration date. Warrants are typically issued by companies to raise capital or as part of a corporate action, such as a merger or acquisition.

They can be listed or unlisted, and may be automatically exercised or require manual action, depending on the terms set by the issuing company.

How does etoro handle warrant distributions?

If a warrant is issued as part of a corporate action on a stock you hold, etoro will handle the process as follows.

If our provider supports the listing and pricing of these warrants:

• a new warrant asset will be created on etoro
• once pricing becomes available and trading begins, you’ll be able to view, hold, or sell the warrants directly on the platform

If the provider does not support listing or pricing:

• the warrants will be liquidated at the best available market price, or if liquidation is not possible, will expire without value
• if liquidation is possible, you’ll receive a cash compensation equivalent

In some cases, exercising warrants may be limited by market access or operational constraints. If action is required, we will communicate directly with those affected.

What if I hold a CFD?

If you hold a CFD position on the issuing company:

• If the warrants are traded on the market and our provider supports liquidation, you’ll receive a cash equivalent based on the value of your position.
• If the warrants are not supported by our provider, no cash or warrant adjustment will be made to your position. This means you will not receive any economic benefit from the warrant distribution.

Learn how Stock Margin positions are handled in the event of a warrant distribution