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To implement the right of the holder of an option to buy (in the case of a call) or sell (in the case of a put) the underlying security.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.


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


To require the delivery (for example, a call option) or to force the purchase (for example, a put option) of the option's underlying asset. Many options expire without being exercised because the strike price stated in the option is unfavorable to the holder.
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.


When you act on a buying or selling opportunity that you have been granted under the terms of a contract, you are said to exercise a right.

Contracts may include the right to exchange stock options for stock, buy stock at a specific price, or buy or sell the security or product underlying an option at a specific exercise price.

For example, if you buy a call option giving you the right to buy stock at $50 a share, and the market price jumps to $60 a share, you'd likely exercise your option to buy at the lower price.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
The indefinite civil detention of sex offenders under modern sexually violent predator (SVP) statutes poses unique problems in the area of free exercise of religion.
Yoder and maintained the Court's legal conviction that an individual's First Amendment right to free exercise of his or her religion was something courts should strongly protect.
[but] there are areas of conduct protected by the Free Exercise Clause ...
Rather, the peace and safety provisos likely constituted narrow, compelling state interests that were narrow exceptions to an otherwise broad free exercise right.
(38) The people retained all rights not surrendered to the state--including certain rights, like the free exercise of religion, that were "by their nature inalienable." (39) Even should "natural rights have natural limits," (40) the state could only infringe religious liberty pursuant to the "peace and safety" of the state when religiously motivated conduct violated the physical security of society or harmed the negative liberty or property rights of others.
While the lack of precedent may suggest that the lower federal courts are writing on a tabula rasa with respect to corporate free exercise rights, the slate is not as blank as several district courts have suggested.
Although the Supreme Court has not specifically addressed whether for-profit corporations have free exercise rights, it has established rules for determining whether corporations can invoke particular constitutional rights.
into the Free Exercise Clause so long as courts apply strict scrutiny to
state action that restricts the free exercise of religion where the
This possibility is precluded by the Smith Court's reasoning because clearly the Free Exercise Clause right would be inadequate by itself in an exemption case under the Smith Court's reasoning.
The mischaracterization of Yoder would be more troubling if the traditional story of Free Exercise Clause jurisprudence were accurate, but the reality is that Sherbert and Yoder were never the panacea they have been made out to be.