European option


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European option

Option that may be exercised only at the expiration date. Related: American option.

European Option

An option contract that may only be exercised on the expiration date. For example, if one buy a European call giving him/her the right to buy shares in X expiring on the final Friday in March, the call may only be exercised on the final Friday in March. The implication of a European option is the fact that its value is entirely dependent on the value of the underlying asset at the end of the contract. A holder may not wait for an advantageous price and exercise the option. This contrasts with an American option, which may be exercised at any time prior to expiry.

European option

An option that can be exercised only on its expiration date, in contrast to the option available in the United States whereby the owner may exercise any time up to and including the expiration date.
References in periodicals archive ?
This is because it is not true that the owner of a long-life European option has all exercise opportunities open to the owner of a short-life European option.
Let us all pray for some genuine inspiration rather than an easy European option in selecting a genuine successor to St Peter rather than preserving an all-too-convenient secret society bent on perpetuating its own power base.
To this end, the new set of points will cluster the grid nodes not only at the boundaries but also at the singularity located at the strike price for a European option.
Popular European option for helping reduce emissions and increasing fuel economy expected to triple in U.
His topics include stochastic processes, numerical methods, European option pricing, and pricing outside the standard Black and Scholes model.
The holder of an American option has the right to exercise the contract at any stage of during the period of the option, whereas the holder of a European option can exercise his right only to the end of the period.
As the number of time periods is increased with bound, the Cox, Ross and Rubinstein (1979) model converges to the famous Black and Scholes (1973) European option model.
Smith accommodated both players in a 4-1-4-1, or 4-5-1 system, and stressed this is his favourite European option.
The US and the European Union have a strong stake in keeping open a European option for Ukraine.
The key point of the PBS is to calibrate and recalibrate the BS model to fit the European option prices.
Mr Kumar said the European option could cushion staff through a period where they may not be enough work to keep plants fully manned.
Does Mr Brown favour the European option for a buy-out of a toxic debt - similar to the US solution?

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