conventional option

Conventional option

An option contract arranged on the trading floor and traded regularly. The opposite of exotic option.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Conventional Option

An American option or European option that is not traded on an exchange. That is, a conventional option has no special features that would exclude it from an exchange but, nonetheless, is privately negotiated and agreed between the parties. A conventional option is illiquid because there is little secondary market for it. It has become a rare investment vehicle, as trading options on exchanges have become more common.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

conventional option

A put or call option contract negotiated independently of the organized option exchanges. Before 1973 and the opening of the Chicago Board Option Exchange, all options originated through private negotiations. The disadvantage of conventional options is their lack of liquidity due to a limited secondary market. See also FLEX option.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
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It made Pakistan adventurous, while India embraced the idea that with nuclearisation, the conventional option was gone.
The alternative power source is rapidly becoming a conventional option, and construction leaders that recognise this will note growth in the years to come.
Section II gives a brief discussion of conventional option theory and the characteristics of MLB contacts.
To cater to the hotel's business clientele, a second, modern style provides a more conventional option, with muted tones.
If consumers perceive the organic price to be high they are going to react very negatively to the fact that they cannot find a conventional option anymore; they will feel financially penalized for it."
In contrast to this consensus, this Article describes a method we call the "conventional option, " which allows the filibuster to be reformed by a simple majority of senators at any time using ordinary Senate procedures.
Hill was considered a more conventional option, the board's president said.
He adds: "Beforehand there was a debate over whether Salsabil should take on the colts in the Derby or take the conventional option of the Oaks, but I stayed out of it.
He's the more conventional option at quarterback, so Oregon defensive ends Nick Reed and Will Tukuafu can put their focus on pass rush.
As mentioned above, conventional option premia should not be counted as income because they correspond to the issuer's contingent liabilities in the future.
clients, the more conventional option would have been to decant to the suburbs, yet in this affordable and adaptable house, they can remain part of the life of the city.
Other possibilities might include an unbounded reward for success and a bounded penalty, or perhaps simply an indexed option that is limited in both directions as compared to a conventional option. With such a reward scheme, an employee might simply try hard to outperform the benchmark rather than to differentiate for the sake of speculation.(41) But inasmuch as this sort of tinkering depends on the likely avenues of differentiation and on individual employees' risk attitudes, I think it is safe to say simply that indexed options introduce risk alteration, or overdifferentiation, concerns that conventional options do not.

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