Derivatives

Resetting Snowball

August 3, 2021
Islamic Finance

Applications of Murabaha

August 3, 2021

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A barrier option in which the barrier is resettable during the life of the option. More specifically, it enables the holder of the barrier option to reset the barrier level up to a specific number of time during its time to maturity. This feature translates into an additional protection to the holder, and hence makes the resettable barrier option more expensive.

This option is also known as an improver option.

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