A warrant is a derivative instrument whose value is dependent on the underlying asset. Warrants offer investors leverage. Typically, with the same investment outlay, the investor would be able to buy many more times the warrants than if he had bought the underlying asset directly.

The gains to the investor will be magnified should the price of the underlying asset move in his favour. Warrants that are listed in Singapore on the SGX are called "Structured Warrants". The investor is able to buy and sell structured warrants the same way he would trade normal shares. As the price of the warrant is usually smaller than the underlying asset, the transaction cost in trading warrants is lower.