Warrants trade similarly to stocks, but they have specific rules you should know before investing. Here's how to buy and sell them, and what to expect in each scenario.
How to buy a warrant
To buy a warrant, search for the asset by name or ticker in the app. Keep in mind that warrants have a ticker that usually ends in "W" (e.g. CRESW, AUUDW). Once you find it, the process is similar to buying any stock:
- Go to the asset detail screen and tap Buy.
- Enter the amount you want to invest.
- Before you confirm, you'll see a warning with the instrument's specific risks. Read it carefully before moving forward.
- Confirm the order. Your portfolio will update automatically once it's executed.
Can I exercise a warrant on Bitso?
No. On Bitso, warrants are only available for buying and selling on the secondary market. This means you can't exercise the right the warrant represents, that is, you can't use it to acquire or sell the underlying stock at the agreed price. Your only option to recover value from a warrant is to sell it on the market before its expiration date. If the warrant reaches its expiration date without being sold, it'll lose all its value and your invested capital won't be refunded.
How to sell a warrant
To sell, go to your portfolio, select the warrant, and tap Sell. The order type available depends on the warrant's current state.
When the warrant has normal liquidity, you can use a market order, which executes at the best available price at that moment. When the warrant is illiquid, the only option is a limit order: you set the minimum price you're willing to sell at, and the order only executes if the market reaches that value.
What happens if there are no buyers for my warrant?
When a warrant is illiquid, it can be difficult or impossible to sell before it expires. If you place a limit order and no buyer is found at your set price, the order is automatically canceled and the warrant expires worthless.
In this scenario, there are no refunds: if the warrant expires without being sold, your invested capital is lost.
What happens when a warrant expires?
When a warrant reaches its expiration date with no value, the asset is automatically removed from your portfolio as part of a corporate action called Worthless Removal. You'll receive a notification in the app and can review the details in your Activity section.
Keep in mind that your invested amount is not refunded. If the warrant expired worthless, the capital is lost.