Exercise price

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Exercise price

The price at which the security underlying an options contract may be bought or sold.

Strike Price

In options, an agreed-upon price for which the underlying is bought (in case of a call) or sold (in case of a put) if the option is exercised. For a call option to be profitable, the strike price must be lower than the market value of the underlying at the time the option is exercised. The opposite is true for a put: the strike price must be higher than the market value. In most cases, the amount of the strike is stated in the option contract; however, in Asian options, the strike is a formula, rather than a set price. For example, the strike may be the average price of the underlying over a set period of time. The strike price is also known as the exercise price or the striking price.

exercise price

The dollar price at which the owner of a warrant or an option can force the writer to sell an asset (in the case of a call option or warrant) or to buy an asset (in the case of a put option). The exercise price is set at the time the option is issued and, except for unusual instances that include warrants, remains constant until the option expires. A market price of an asset above, or expected to be above, an option's exercise price gives the option value. See also aggregate exercise price, step-up.

Exercise price.

An option's exercise price, also called the strike price, is the price at which you can buy or sell the stock or other financial product that underlies that option.

The exercise price is set by the exchange on which the option trades and remains constant for the life of the option.

However, the market value of the underlying investment rises and falls continuously during the period in response to market demand.

References in periodicals archive ?

The short-term reduction in warrant exercise prices is intended to provide a quick and inexpensive means to obtain additional capital in a difficult climate for raising capital by entities such as the Company.

Caprius Offers Reduced Warrant Exercise Price to Warrant Holders

Pursuant to the terms of the Merger and the terms of each of the IOI warrants and the New PowerBrief warrants, the exercise prices of the warrants were to be calculated in part based on the post-Merger market trading prices for New PowerBrief's Common Stock.

PowerBrief Announces Exercise Prices and Ratios of Warrants

About 40% of Quantum's outstanding stock options have exercise prices significantly above the company's current market price.

Quantum Corporation Announces Stock Option Exchange Program for Employees

commented, "This reduction in the exercise price of the Company's warrants is expected to produce near-term benefits to both warrant holders and Farmstead.

Farmstead Telephone Group, Inc. Plans Reduction in Exercise Prices On Company Warrants

FTCN) of Tampa, announced Friday an extension of the exercise date and a reduction of the exercise price of the company's A Warrants and B Warrants.

The Freight Connection Inc. announces extension of the exercise date and a reduction of the exercise price of the company's A Warrants and B Warrants

In the alternative, the company offers a reduced warrant exercise price of 25 cents per A Warrant, the proceeds of such exercise being placed in an escrow account in anticipation of the merger.

Source Scientific announces contemplated merger and reduced warrant exercise price

Finally, Part V discusses the potential additional benefit of providing in the option plan for the use of previously acquired shares of employer stock to pay the exercise price under an ISO, and explores other means of facilitating the exercise of ISOs by employees.

Incentive stock options revisited

Plus, you should disclose the range of exercise prices (in addition to the weighted average exercise price) and the weighted average remaining contractual life for options outstanding as of your last balance sheet.

Taking stock of Statement 123

Under this guideline, most companies have offered employee stock options with fixed terms--both the exercise price and the number of shares are fixed at the grant date.

Employee stock option accounting changes

On July 10, 1992, the Company had announced that the exercise price of the Initial Warrants was being reduced from $7.

HEALTHCARE IMAGING SERVICES, INC. ANNOUNCES EFFECTIVE DATE OF REGISTRATION STATEMENT

On several occasions, in order to select favorable exercise prices for certain newly hired executives or other senior personnel, the Company created employment records to establish start dates that preceded the date they actually began working for the Company.

Microtune Announces Principal Findings of Stock Option Investigation

The Special Committee further concluded that, as a result of, among other things, such inadequate controls and practices, there were certain instances where the exercise prices of certain stock option grants, principally related to new hire grants, appear to have been selected with the benefit of hindsight -- i.