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Derivatives




Boston Option


An option in which payment of the premium is deferred until the expiration of the option. A Boston option is a type of an American option. In general, this option is a long-term investment due to the fact that the expiration date and the premium payment are generally a year after the date the contract is initially concluded.

It is also known as deferred premium option.

 



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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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