Islamic Finance

Riba al-Fadhl

June 28, 2020
Derivatives

One-Touch Option

June 28, 2020

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A barrier option which will be knocked out or deactivated if the outstirke barrier has been hit or touched three times during the option‘s life. In this sense, a baseball option is similar to a touch option, except that the number of touches are three rather than one.

The name is derived from the baseball game parlance “three strikes and you are out”.

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