An option (warrant) that is issued alone, i.e., without an accompanying bond (i.e., the host bond), and one that has a very distant expiration date. It gives the holder the right, but not the obligation, to buy (in which case it is a call warrant) or sell (in which case it is a put warrant) a specific quantity of an underlying instrument at a pre-agreed price, with a long period of time available to exercise it. The right is tradable (issued as a security in its own) and is issued independently of the underlying security.

The writer of an uncovered warrant is not necessarily the issuer of the underlying instrument.

An uncovered warrant is also referred to as a naked warrant.