European option

European option

Option that may be exercised only at the expiration date. Related: American option.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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.
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.
References in periodicals archive ?
There is a PSfor each order to cover styling conne THE EUROPEAN OPTION LOOKIERO lookiero.co.uk How it works: Spanish-based in the your look questionnaire Monthly, delivery 10 fee costs.
The proactive hedging option combines the classical European option with a mandatory constraint, which requires the option holder to adjust the amount of the on-hold underlying asset according to the contracted strategy.
This paper has three main goals: (1) define and study the properties of the family of Gram-Charlier distributions; (2) define a Gram-Charlier process and derive its basic properties; (3) apply those to European options. The formulas we give for European option prices and Greeks apply to Gram-Charlier distributions of any order, and we use four- and six-parameter Gram-Charlier distributions in our examples.
We use a European option price as control variate and modify step (19) of Algorithm 1 as follows:
The European option would depend on Albion's willingness to sell him in January.
Salam is more like the European option, because it can be exercised only on the due date using the predetermined exercise price.
That's living all right...British <B workers need a European option
Cox and Ross (1976) have shown that the price of a European option on the share S can be written as the discounted expected value of its payoffs at expiration.
Vazquez, "An upwind numerical approach for an American and European option pricing model," Applied Mathematics and Computation, vol.
where [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII] is the real value of American call option (see Broadie and Detemple [6]), which means that the value of capped option is much closer to the true American option than the European option, it is more accurate to replace [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII].
Black and Scholes [1] described a mathematical framework for calculating the fair price of a European option in which they used a no-arbitrage argument to derive a partial differential equation which governs the evolution of the option price with respect to the time to expiry, t, and the price of the underlying asset, S; that is,
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.

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