Option Style
In finance, the style or family of an option is a general term denoting the class into which the option falls, usually defined by the dates on which the option may be exercised. The vast majority of options are either European or American (style) options. These options—as well as others where the payoff is calculated similarly—are referred to as "vanilla options". Options where the payoff is calculated differently are categorized as "exotic options". Exotic options can pose challenging problems in valuation and hedging.
Read more about Option Style: American and European Options, Non-vanilla Exercise Rights, "Exotic" Options With Standard Exercise Styles, Non-vanilla Path Dependent "exotic" Options, Related
Famous quotes containing the words option and/or style:
“Our passional nature not only lawfully may, but must, decide an option between propositions, whenever it is a genuine option that cannot by its nature be decided on intellectual grounds; for to say, under such circumstances, “Do not decide, but leave the question open,” is itself a passional decision—just like deciding yes or no—and is attended with the same risk of losing the truth.”
—William James (1842–1910)
“Switzerland is a small, steep country, much more up and down than sideways, and is all stuck over with large brown hotels built on the cuckoo clock style of architecture.”
—Ernest Hemingway (1899–1961)