abandon

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Abandon

1. To decide not to exercise an option. This occurs when an option is out-of-the-money on the exercise date. That is, one may abandon an option if it is currently unprofitable and thus highly unlikely to become profitable.

2. To withdraw one's claim to an asset, especially an unprofitable one. Corporations must file appropriate paperwork with the government to abandon assets. Alternatively, an individual may abandon both real and personal property. For example, a homeowner may leave his/her house and never intend to return. A squatter may then come to possess the home through adverse possession. An important component of abandonment is the owner's intent never to return or otherwise possess the property again.

3. To opt out of a forward contract according to the procedure specified therein. When one abandons a forward contract, one does not buy or sell the underlying asset and it is not delivered.

abandon

To elect not to exercise an option.
References in periodicals archive ?
To consider abandoning these assets, the net present value of remaining cash flows must be estimated.
The Court held that the Agency had breached the contract and the contractor was justified in abandoning the contract.
On the other hand, some taxpayers may want to consider legally abandoning the property.
While the concepts may be related, abandoning a property or asset is not necessarily the same as determining it is worthless.
The appellate court also ruled that the owner breached the contract in the process of abandoning same.
Abandoning children is almost like murdering them, so we treat these cases very seriously," Al Sha'ali said.
The loss was allowed because of the difficulty in abandoning a nuclear power plant and the fact that the taxpayer had taken all the steps necessary to abandon the plant and could not reverse course to recover the property.