European option

(redirected from European-Style Options)

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 ?
The American-style options will be offered in two months in the March Quarterly Cycle, and the European-style options will be offered in two serial months.
At present time Company concentrates on Monte Carlo based methods like Black-Sholes model for European-style options.
Options to be listed will include an average price option and underlying calendar swap, as well as American-style and European-style options.
The Black-Scholes model was developed for European-style options exercisable only at expiration.
The enclosed interactive CD supplements these concepts and includes a calculator for European-style options, a bonus quiz, additional articles and links to helpful information.
They differ from European-style options contracts, which may be exercised only on the expiration date.
CME has offered side-by-side trading of currency options since 2005 when it launched European-style options on CME Euro FX futures and CME Japanese Yen futures.
The new, European-style options are scheduled to be listed on Sunday, July 30, 2006, at 5:00 p.
The new, European-style options on these two futures contracts will be listed on Sunday, April 3, 2005, at 5:00 p.
The conversion to European-style options expiration, which will take place in an orderly fashion over several months as outlined below, applies to all equity index options contracts traded via CME's electronic or open outcry markets.

Full browser ?