How does the distribution of dividends of an underlying stock affect the price of a warrant or CBBC?

When a listed company announces its financial results, it will also generally announce whether dividends will be paid.

Whether or not this affects the price of a related warrant or CBBC depends on whether or not dividends were expected and, if so, at what level and on what date. This is because the issuer considers past records of dividend distribution and the dividends expected by the market, when calculating the warrant or CBBC price.

If the dividend distribution and ex-dividend date are as expected and other factors remain constant, theoretically, the dividends should not affect the price of the warrant or CBBC.

You may read further "What if the underlying stock eventually declared a dividend lower than expected? How about if the declared dividend is larger than expected?" .