Glossary
Warrants
Type of security usually issued together with a loan, a bond or preferred stock. Warrants are also known as stock-purchase warrants or subscription warrants, and allow an investor to buy ordinary shares at a pre-determined price.
Warranty
Statements, usually contained in a share subscription or purchase agreement, as to the existing condition of the company which, if not true, support a legal action for compensation by way of money damages.
Weighted average cost of capital
Weighted average cost of capital is a discount rate used in valuation model reflecting the opportunity cost of all capital providers, weighted by their relative contribution to the company’s total capital.
White Knight
A company that makes a friendly takeover offer to a target company that is being faced with a hostile takeover from a separate party.
Write-down
A reduction in the value of an investment.
Write-off
The write-down of a portfolio company’s value to zero. The value of the investment is eliminated and the return to investors is zero or negative.
Write-up
An increase in the value of an investment. An upward adjustment of an asset’s value for accounting and reporting purposes.
