Covered Warrant Fully Backed Warrant Fully Collateralized Warrant Secured Warrant Third-Party Covered Warrant Third-Party Backed Warrant A Covered Warrant is a financial instrument issued by a third party that is not the issuer of the underlying securities to which the warrant refers. The issuer of the covered warrant holds a sufficient quantity of the underlying securities to cover all the warrants if they are exercised, providing a level of security to the warrant holders.