Exchanges
Bid Price
August 8, 2020
Derivatives
Limit Option
August 8, 2020

Another name for barrier option. By definition, it is an exotic option whose payoff depends on whether the underlying asset price reaches a specified threshold (a predetermined knock-in or knock-out price) or not. A knock-in option comes into existence only when the underlying asset reaches the threshold (the barrier). To the contrary, knock-out options cease to exist if the asset price reaches or breaches the barrier.

The stoption is alternatively known as a limit option.

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