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Plain Vanilla Barrier Option


A standard barrier option where an event takes place at the first touch of the pre-specified barrier. In other words, the option’s payoff depends on whether the underlying reaches, for the first time, a preset knock-in or knock-out price or not. This in contrast with with more exotic barrier and event specifications.

Plain vanilla barrier options are also referred to as one touch barrier options.



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Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
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