A ladder option that has a fixed strike price. This option , which carries a predetermined strike price, allows the holder to lock in any gains attained over the course of the option’s life where and wherever the underlying price becomes better than preset market levels (the rungs). Accumulated gains will never perish if the market retraces thereafter. The amount of gains is calculated by comparing the expiration price and ladder rungs at maturity against the predefined strike price. The holder will get the larger amount of the two.

The option pays the difference between the highest of a series of threshold prices (rungs) hit by the underlying and the fixed strike, or nothing if no rung is reached.

This type of ladder option is also known as a modified ladder (modified ladder option).