A broker's notification from a client who wants to exercise a right to buy or sell (depending on the type of contract) the underlying security of the option contract.
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The written notice of the holder of an option contract of his/her intent to exercise the option. Exercise notice may occur on or before the expiration date, depending on the type of option contract. The exercise notice is sent to the Options Clearing Corporation, which is responsible for settling the transaction by finding an investor with an opposite position on the same contract.
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A notice sent by an option holder to the Options Clearing Corporation, calling for fulfillment of the option's terms. The OCC will then assign fulfillment to someone short the same 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.