combination option

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Combination Option

A series of option contracts consisting of at least one call and one put with the same underlying asset. The combination option is written as a single unit but each of the component contracts may be resold on the secondary market separately. Each of the contracts has different strike prices and/or different expiration dates. Combination options exist in order to hedge one's investments. An investor may exercise either the call or the put, depending on the underlying price trends over the life of the contract, and still make a profit on the transaction. See also: Cliquet, Straddle, Strangle.

combination option

An option composed of one or more calls and one or more puts. While the original combination is sold as a single unit, each part may be sold or exercised individually. Examples of combination options are spreads, straddles, straps, and strips.
References in periodicals archive ?
To exploit the market upswing, auto-injector and imaging modality vendors are exploring various combination options to promote bundled sales.
Favorites include original recipes and authentic dishes, like Carne Asada Fries, Chile Rellenos, Authentic Tortas, freshly made tostadas and a “healthy dining menu” with multiple combination options.
5 Quadrillion Combination Options That Are Hand Tailored to Customers' Exact Specifications
Additional combination options are available, providing further customization options for various materials and customer expectations.
Earlier, on June 6, 2010, RCom's board of directors had in- principle approved a proposal to induct strategic and/ or private equity investors for a 26 per cent shareholding in the firm at an appropriate premium to the prevailing market price, and/ or appropriate consolidation/ combination options.
KraussMaffei has also extended the selection matrix for the LRX series, so that customers have more combination options than with the LR.
He now sees more college students and more female customers, and is taking their suggestions into account for a revised fall menu, which will include more combination options and greater salad variety.
Remington offers a Cable Lock and Trigger Block; Beretta has a Security Pack; Pro-Lok provides the GunLok; and Master Lock markets cable and trigger locks, with key and combination options.
It has heat, bubble and massage combination options, hinged foot rest lid and on/off indicator.
And there are several other combination options available.
Companies are forced to either go "naked" on anticipated foreign currency transactions, purchase high-cost options to avoid adverse accounting or risk the income-statement volatility of mark-to-market accounting by using more cost-effective forwards and combination options.
91-4 addresses complex options (purchased options with significant intrinsic value, written options and various types of combination options, purchased and written as a unit) and similar instruments.