Traded Options Pricing After Issuing Warrants And Corporate Bonds

In developed countries, the corporate bond market is in the centre of the capital market . After the financial crisis in Southeast of Asia,the corporate bond market in developing countries of Asia has also been rapid Developed. In the early days, the main way of financing is issuance of stock ,the supplementary way of financing is issuance of bonds. With the gradual development of economic and the modernity of the enterprise system , the issuance of bonds has become the first choice of financing.From the world financial market perspective, warrants is a frequently traded financial instruments with a long history. A high degree of economic development of the shareholding system of the securities market has brought prosperity.Some joint-stock companies needs to supply the investment during the production to meet cash flow needs, to fully use of a highly developed.financial markets, we should create a new financial derivatives-warrants. So the pricing of warrants, as well as its impact on the pricing of other financial derivative products, as well as simplified model of numerical algorithm is indispensable.In the previous paper of warrants ,there is only pricing of warrants without bonds and historical data analysis of warrants. In this paper,I use the pricing model of warrants and the analysis of compound options to analyze the warrants pricingmodel with bonds as well as the value of the option based on the stocks.The truncation have such kinds as follows:Theorem1: the corporation issue the warrants and bonds,the value of the warrantsat t(t₀≤t≤T_W) is:W_t(S_t,x,t₀,T_W)=N/M+NE^Q{e^-r(T_w-t))(U_TW-D_TW/N-x)⁺|F_t}.Theorem2: There exists K₁ > 0 such thar:W_t(S_t,x,t₀,T_W) =N/M+NC_t(U_t,K₁,T_W)-1/M+NPP_t(V_t,K₂,T_D),and K₂ = P_TW(N/aK₁,F,T_D),PP_t(V_t,K₂,T_W) P_t(V_t,F,T_D) is a european put option,the strike is K₂,and the maturity is Tw.Theorem3: the compound put option is increase about the underlying asset,and(?)PP_t/(?)S=N₂(a₊,-b_;-(?))>0Theorem4: There exists K₃> 0 such thatC_t(S_t,x₀,T_C)=C_t(U_t,K₃,T_C)-M/M+N CC_t(U_t,K₄,T_C +M/N(M+N)CPP_t(V_t,K₅,T_C)-1/NPP_t(V_t,K₆,T_C),andK₄=M/M+NC_TC(K₃,K₁,T_W),K₅=M/N(M+N)PP_TC(N/aK₃,K₂,T_D),K₆=1/NP_TC(N/aK₃,F,T_D),...