SIE (Securities Industry Essentials) Practice Exam

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At the time of issuance, which security normally has the longest period to expiration?

  1. Bonds

  2. Common stocks

  3. Preferred stocks

  4. Warrants

The correct answer is: Warrants

Warrants generally have the longest period to expiration at the time of issuance. A warrant is a type of security that gives the holder the right, but not the obligation, to buy or sell an underlying asset at a specific price, on or before a certain date in the future. Bonds have a fixed maturity date and common and preferred stocks have no predetermined expiration date, making warrants the correct answer.

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