Arbitrageurs will use derivatives to equilibrate the prices of securities and commodities in different markets. Arbitrageurs will look for a profitable imbalance between futures and spot prices. The process will continue until the aggregate of the costs increase to the extent that arbitrage is no longer profitable. Right and Warrants Rights and warrants are similar to options, except that they are issued by the firm whose stock is the subject of the right or warrant. Thus, at the time of an initial stock issue by a firm, rights and warrants may be attached to the shares in order to 'sweeten the deal'.
Warrants are essentially call options issued by firms.
Warrants can either be detachable or non-detachable. Detachable refers to the warrants being not only exercisable, but tradable on the open market. That is, they can be detached and sold separately. Non-detachable refers to the warrants only being exercisable and not tradable. Rights give shareholders the preemptive right to subscribe to a new share offering before the general public.