Exercising the option


Also found in: Dictionary, Thesaurus, Medical, Legal, Encyclopedia.

Exercising the option

The act of buying or selling the underlying asset via the option contract.

Exercise

In option contracts, to buy (in the case of a call) or sell (in the case of a put) the underlying asset. The option holder has no obligation to exercise the option, and only does so if he/she believes it benefits him/her. Depending upon the nature of the option, this may be done at any point during the life of the contract, or it may only be done on the contract's expiry date. The strike price of the sale is agreed-upon in the option contract, that is, before the option is exercised.
References in periodicals archive ?
US$3/ounce for inferred mineral resources, payable in 5 equal annual instalments beginning 120 days after exercising the option
In addition to exercising the option early, we have gone from the start up of exploration to mining in just 14 months.
After several meetings with IUT-Berlin management and obtaining their commitment to provide the necessary people and priority to developing our acquired technologies, we jointly decided that the funds should be spent on developing the technology instead of exercising the option.