call option

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Related to European call option: put and call, European put option

Call option

An option contract that gives its holder the right (but not the obligation) to purchase a specified number of shares of the underlying stock at the given strike price, on or before the expiration date of the contract.

Call Option

An option contract in which the holder has the right (but not the obligation) to buy the underlying asset at an agreed-upon price on or before the expiration date of the contract, regardless of the prevailing market price of the underlying asset. One buys a call option if one believes the price for the underlying asset will rise by the end of the contract. If the price does rise, the holder may buy and resell the underlying asset for a profit. If the price does not rise, the option expires and the holder's loss is limited to the price of buying the contract. Call options may be used on their own or in conjunction with put options to create an option spread in order to hedge risk.

call option

See call.

Call option.

Buying a call option gives you, as owner, the right to buy a fixed quantity of the underlying product at a specified price, called the strike price, within a specified time period.

For example, you might purchase a call option on 100 shares of a stock if you expect the stock price to increase but prefer not to tie up your investment principal by investing in the stock. If the price of the stock does go up, the call option will increase in value.

You might choose to sell your option at a profit or exercise the option and buy the shares at the strike price. But if the stock price at expiration is less than the strike price, the option will be worthless. The amount you lose, in that case, is the premium you paid to buy the option plus any brokerage fees.

In contrast, you can sell a call option, which is known as writing a call. That gives the buyer the right to buy the underlying investment from you at the strike price before the option expires. If you write a call, you are obliged to sell if the option is exercised and you are assigned to meet the call.

call option

see OPTION.

call option

see OPTION.

call option

See call provision.
References in periodicals archive ?
Although Salam is similar to the European call option as a hedge against future price fluctuations, it, unlike options, does not stipulate the exercise price be less than the expected future price.
Figures 1 and 2, respectively, show the payoffs for European call options and Salam.
3 represents the numerical solution for a European call option together with its Delta ([DELTA]), Gamma ([LAMBDA]), and the numerical error.
For a European call option written on the asset with strike price X and maturity T, Bakshi, Cao, and Chen (1997) show that its price C(t, S, v, X) is given as
Hamada and Sherris (2003) applied Wang transform to price European call option written on a security with prices following a geometric Brownian motion and they derived the Black and Scholes option price formula.
First, we derive a closed-form valuation formula for calculating European call option prices after warrants issuance in the Black-Scholes model.
The pathwise estimator of delta for the European call option is given by
The pioneer venture can be naively seen as a European call option on a futures contract, where the futures price, F, is equal to the value of the commercial venture in seven years.
This is the same as the payoff to a European call option on the CPI with an exercise price of 1.
As such, strategic corporate investment options can resemble European call options and may be analyzed using a Black-Scholes Model of Option valuation.
The estimated minimum value of the option implied by the lease is based on the pricing formula for European call options (Chance, 1992):
European call options can be exercised only on a given future day, while American call options can be exercised on any day up to and including some maturity date.

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