Hybrid Securities
Hybrid securities, as the name suggests, combine some of the characteristics of both debt and equity
securities. Examples of hybrid securities include equity warrants (options issued by the company itself
that give shareholders the right to purchase stock within a certain timeframe and at a specific price),
convertible bonds (bonds that can be converted into shares of common stock in the issuing company),
and preference shares (company stocks whose payments of interest, dividends, or other returns of capital
can be prioritized over those of other stockholders).