Exchanges
Volume Participation Algo
November 11, 2021
Derivatives
Step-Down Option
November 11, 2021

A standard option where part or all of the premium is deferred, depending on the spot price reaching preset triggers during the life of the option. If the spot price reaches or breaks trough a particular trigger level before expiration, the buyer of the option (the long) will have to pay the specified premium amount as corresponding to that trigger level.

This option is also known as a step-premium option.

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Posts